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July 15, 2021

TAS Tax Tip: Ten Things to Know About Advance Child Tax Credit Payments

Ten Things to Know About Advance Child Tax Credit Payments

For taxpayers wanting more information about the 2021 Child Tax Credit and advanced payment option, here’s ten things you need to know.

  1. The IRS is determining potential Advanced Child Tax Credit Payment (AdvCTC) eligibility* using information from:
    • taxpayer’s 2020 tax return (or, in some cases, taxpayer’s 2019 tax return),
      or
    •  taxpayer’s information submitted by using the Non-Filers tool on IRS.gov last year (to register for an Economic Impact Payment),
      or
    • taxpayer’s information submitted using the new non-filer tool this year.
      *Note that this is not necessarily the same as the information that the IRS will use to determine your bank account information.
  2. If taxpayer is unsure if they qualify, they can use the Advance Child Tax Credit Eligibility Assistant tool to find out.
  3. Families who are eligible for AdvCTC (based on the above) will receive three letters.
  4.  The monthly payment amount will be up to $300 per month for each qualifying child under age 6, and up to $250 per month for each qualifying child ages 6 to 17.
  5.  Payments start July 15, 2021. Additional payments will be issued:
    Aug. 13 | Sept. 15 | Oct. 15 | Nov. 15 | and Dec. 15.
  6. Payments will be issued either by direct deposit or paper check.
  7. Taxpayers will be able to use the IRS Child Tax Credit Update Portal to:
      • Check if they are enrolled to receive advance payments.
      • Unenroll to stop getting advance payments. Important note: if taxpayers are married filing joint, both must unenroll.
      • Provide or update bank account information for monthly payments sent in August or later.
        Note: More functionality within this tool will be added later this year that will allow taxpayers to:
      • Make changes to your address;
      • Report a change to your dependents;
      • Report a change in marital status; and
      • Report a change in income.
  8. Taxpayers who unenroll can still report the Child Tax Credit on their 2021 individual income tax return.
  9.  All taxpayers who receive AdvCTC will be required to reconcile the total payments received versus the total Child Tax Credit they qualify for on their 2021 Individual Tax Return, when they file in 2022.
  10.  The best places to find more information about AdvCTC are: