Welcome to the topic of “Advance Child Tax Credit Payments.” The Advance child tax credit will provide a well needed relief for many American families.
Advance Child Tax Credit will help many families get advance payments of the credit starting this summer. The IRS will pay half the total credit amount in advance monthly payments beginning July 15. You will claim the other half when you file your 2021 income tax return. These changes apply to tax year 2021 only.
Who Qualifies?
To qualify for advance Child Tax Credit payments, you and your spouse, if you filed a joint return, must have:
• Filed a 2019 or 2020 tax return and claimed the Child Tax Credit on the return, or
• Given the IRS your information in 2020 to receive the economic impact payment using the
Non-Filers: Enter Payment Info Here tool, and
• A main home in the United States for more than half the year (the 50 states and the District of
Columbia) or file a joint return with a spouse who has a main home in the United States for more than half the year, and
• A qualifying child who is under age 18 at the end of 2021 and who has a valid Social Security number, and
• Made less than certain income limits.
The IRS will use information you provided to determine if you qualify and automatically enroll you for advance payments. You do not need to take any additional action to get advance payments.
Caution:The total amount of the advance Child Tax Credit payments that you receive during 2021 is based on the IRS’s estimate of your 2021 Child Tax Credit. If the total advance payment is greater than the Child Tax Credit amount you are allowed to claim on your 2021 tax return, you may have to repay the excess amount on your 2021 tax return. You may have received an excess credit due to changes in your income, marital status, or number of qualifying children.
Repayment protection safe harbor.
You may not have to repay some or all of any excess advance Child Tax Credit amount if the excess payment is caused by a change in the number of qualifying children and your income is below a specified amount for your filing status.
The maximum amount of repayment protection is $2,000 for each qualifying child that the IRS took into account when estimating your advance Child Tax Credit .You qualify for the maximum amount if your modified adjusted gross income (AGI) is at or below the following amounts based on the filing status for your 2021 income tax return.
• $60,000 if you are married and filing a joint return or filing as a qualifying widow(er).
• $50,000 if you are filing as head of household.
• $40,000 if you are a single filer or married and filing a separate return.
As your income increases over the above threshold amount, the amount of the repayment protection
decreases. You will not qualify for any repayment protection once your modified AGI reaches the
following levels.
• $120,000 if you are married and filing a joint return or
filing as a qualifying widow(er).
• $100,000 if you are filing as head of household.
• $80,000 if you are a single filer or married and filing a separate return.
CTC UP. Use the IRS Child Tax Credit Update Portal (CTC UP) throughout 2021 to help ensure the IRS
has the most up to date information about your eligibility for the 2021 Child Tax Credit and to minimize any potential excess payment. You will find the CTC UP at the IRS website listed earlier.
When will payments start?
• Eligible families can receive advance payments of up to
$300 per month for each child under age 6 and up to $250 per month for each child age 6 and
above.
• Advance payments begin July 15 and will be sent monthly through December 15 without any further action.
• You can benefit from the credit even if you do not have earned income or you do not owe any income taxes.
• The credit includes children who turn age17in 2021.
• The tax credit is expanded to include advance payments for 2021 only.
Also read: Entering The World of Tax Credits.
