Do you qualify for advance child tax credit funds? 3 ways to find out

Parents who do not often file their taxes should still qualify for advance child tax credit funds. 

Sarah Tew/CNET

Over 35 million US working households acquired advance child tax credit funds final week. But even when you acquired a verify or know that one is on the way in which, it is best to see if you qualify sooner relatively than later. If you’re not eligible for the complete quantity of the credit however nonetheless acquire it, you could have an disagreeable shock throughout tax time next year if the IRS requires you to pay again the cash. 

The 2021 child tax credit might have a big impact. For instance, an eligible household with a younger child and a newborn might acquire up to $600 a month by way of December, plus a further $3,600 for the 2 dependents subsequent yr. It is dependent upon income and age requirements: Parents with an earnings of lower than $150,000 (married and submitting collectively) will get the utmost: $3,600 for every child underneath age 6 and $3,000 for every child aged 6 by way of 17 — use our calculator to get a fast estimate. And there isn’t any restrict to what number of kids dad and mom can get the additional cash for. 

Half of every household’s whole is available in month-to-month installments this yr, and the opposite half in a payout subsequent yr — except you choose out now to get one lump sum subsequent yr. Before you spend the cash it is best to be certain that you’re eligible. Also, keep in mind that the IRS makes use of present tax information to decide your personalised whole quantity, which may be outdated by now if you’ve had a change in earnings. We’ll inform you what the totally different letters from the IRS imply, how to use to manage your payments and why you would possibly need to opt out of advance checks this yr. This story is up to date regularly. 

1. Read over your IRS letters about your eligibility and estimated quantity

About 97% of working families are eligible for a child tax credit fee, and certified households ought to have acquired a minimum of one letter from the IRS. That means the company decided that you qualify for child tax credit cash primarily based in your 2019 or 2020 federal earnings tax return. In that case, you would have routinely acquired the primary July fee except you already opted out. 

If you do not usually file taxes, the IRS can use any info you submitted on-line utilizing the nonfilers tool. The White House additionally launched, which features a step-by-step information in a number of languages to assist dad and mom use the software. So sure, even when you did not file your taxes you should still get advance month-to-month funds this month. 

The first IRS letter (see pattern PDFs 6416 or 6416-A) advised households they might be eligible. The second letter (see pattern PDF 6417) gave households a custom-made estimate of what their month-to-month advance funds might be all through the rest of this yr. You do not want to do something if you acquired these letters, besides maintain on to them in case you want to reference it afterward. If you did not get a letter, don’t fret fairly but; there are different ways to verify your eligibility. 

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Child tax credit: Everything we know


2. Check your eligibility using the online IRS portals 

The IRS has several online portals and tools to help you get your child tax credit money. The interactive eligibility assistant is the quickest way for families to see if they qualify by answering just a few brief questions. You’ll need your latest tax return to check eligibility. But if any information has changed since then, you’ll need to use another tool to make sure the IRS has the most up-to-date information.

Another online tool, the Child Tax Credit Update Portal, also lets you check to see if you’re eligible and your payment history. You can use it to make decisions about opting out of the advance monthly payments and to add your direct deposit information. It will soon let you add new information and correct or update outdated details like the number of kids you have or your income. 

There’s also a nonfiler tool for those who did not file a 2020 tax return and don’t plan to. While there has been some criticism about it not being user-friendly, lacking a Spanish version and not working well on smartphones, the nonfiler tool is one of the ways that low-income families can give information to the IRS to make sure they get a payment. 

If the IRS says your eligibility is pending, you won’t start receiving payments until you’ve been approved. You can check the status of your eligibility using the Child Tax Credit Update Portal. If the IRS cannot confirm eligibility this year you’ll receive the full child tax credit amount when you file your taxes next year. 

On the other hand, if you find out that you’re not eligible or you’re unsure, there’s still time to opt out before the next payment. You’ll need to opt out ahead of the upcoming check to avoid getting the next payment, but it’s a one-time action. The IRS plans to add a re-enrolling option in September. Here are the unenrolling deadlines to keep in mind. 

Child tax credit opt out deadlines

Payment date Unenrollment deadline 
July 15 June 28 
Aug. 13 Aug. 2
Sept. 15 Aug. 30 
Oct. 15 Oct. 4 
Nov. 15 Nov. 1
Dec. 15 Nov. 29

3. Calculate your child tax credit total amount 

Even if your first child tax credit check is on the way via mail, you can make an educated guess about your qualification status fairly easily. We think the fastest way is to use our child tax credit calculator. Just enter your yearly income and number of kids. Don’t worry — the calculator is private and anonymous and won’t store or use any of your personal information.

For the most part, the calculator tool will tell you what you need to know. However, there are some outlier qualifications that could crop up. For example, in some cases, it’s possible your income will disqualify you

And while parents of new babies will generally qualify for the full amount, that could change if you have shared custody of a child. US citizenship also plays a role, so if any of your kids are adopted from another country, you’ll want to make sure you know all the rules that apply to kids

For more, check here to see if your state owes you money, how you could get money back for your child care costs and if you could get a refund for the unemployment tax break.

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