Child Tax Credit 2021 on July 15th: how to prepare with the eligibility assistant
With payments for the Child Tax Credit beginning on 15 July, the IRS has released two new tools, including the eligibility assistant, to manage installments
The IRS will begin sending payments for the Child Tax Credit on 15 July. Unlike the credit’s previous structure, before the passage of the American Rescue Plan, those in the care of dependents who qualify will receive monthly payments until December. The remaining balance of the credit will be claimed and set with the taxpayer’s refund next year.
Child Tax Credit Payment Dates 2021
How to know if I am eligible?
The IRS recently launched the Advance Child Tax Credit Eligibility Assistant to help those interested “check if you might be eligible for advance payments." You may need to have your 2019 or 2020 tax return handy to provide some information to use the tool. Those who do not have access to their returns “may be able to estimate the total income from your tax return to answer all the questions.” An income statement like a W-2, 1099s, and any “expenses or adjustments to your income,” could also be used to make estimates.
The IRS would also like parents and guardians to know that they may still qualify even if they “aren’t working now or didn’t work in 2020.”
What other tools have the IRS launched to help families manage payments for the Child Tax Credit?
Around the same time the Advance Child Tax Credit Eligibility Assitant was launched, the Child Tax Credit Update Portal (CTC UP) was also released. This tool helps those who are eligible check to ensure they are enrolled and unenroll in case they would like to receive the total credit as a lump sum next tax season.
On 30 June, the IRS announced updates to the functionality which allow those receiving payments to “provide or update your bank account information.” It is too late to make changes for the first payment that will be sent on 15 July. However, if updates are made by 2 August to bank account information, the second payment will be sent using those details.
If the IRS has direct deposit information from when you submitted your 2019 or 2020 taxes, they will deposit the funds directly. The tax authority strongly encourages those with a bank account to receive direct deposits to provide the information. By using direct deposit, The IRS urges any family receiving checks to consider switching to direct deposit. “families can access their money more quickly,” it also “removes the time, worry and expense of cashing a check.” With many scams using the Child Tax Credit as bait, getting the check sent directly to your account “eliminates the chance of a lost, stolen or undelivered check.”
To use the CTC UP, users will need “an existing IRS username or ID.me account, have your photo identification ready.”