IRS Issues Frequently Asked Questions About the Child Tax Credit and Online Tool for Non-Filers

The Internal Revenue Service today updated its Child Tax Credit information page with frequently asked questions and a new online tool to reach low-income people who don’t normally file tax returns. The improved child tax credit from the American Rescue Act basically means that 36 million families with children get more money in their pockets earlier this year, instead of having to wait to get the credit when they file their income tax return. 2021 in 2022.

The expanded credit provides parents with a credit of $ 3,000 for each child ages 6 to 17 and $ 3,600 for each child under the age of 6 (up to $ 2,000 per dependent child through age 16). Anyone eligible for a Child Tax Credit of any size is eligible for advance payments, according to Elaine Maag, senior research associate at The Urban Institute’s Center for Tax Policy.

The IRS will pay half the full amount of the credit in monthly advance payments, and you will claim the other half when you file your 2021 income tax return. The first of the six payments is scheduled for July 15, with the next payments on August 13, September 15, October 15, November 15 and December 15. If you are eligible based on your 2019 or 2020 tax return, the IRS will automatically send you the payments.

Letters from the IRS have already been sent (Letter 6416 or Letter 6416-A) notifying taxpayers that they may be eligible. If you received one of these general letters, it appears that you qualify based on the information on your return. Another round of letters (Letter 6417, look for the number in the lower right corner of the letter) that really matter will be published “soon” according to an IRS spokesperson. These letters will formally notify families of the amount they will receive.

What if your eligibility has changed? The IRS says it will have an online portal where taxpayers can update information, such as a change in income or record the birth or adoption of a child. You can also update your postal address or bank account information. You can also cancel your registration to avoid receiving advance payments. That may make sense if you are self-employed and make estimated tax payments.

Warning: You will need to reconcile your Child Tax Credit advance payment when you file your 2021 tax return in 2022. The total amount of Child Tax Credit advance payments you receive during 2021 is based on the IRS estimate of Your 2021 Child Tax Credit. If the total is more than the amount of the Child Tax Credit that you can claim on your 2021 tax return, you may need to repay the excess amount on your 2021 tax return during the 2022 tax filing season.

How can those who do not declare receive payments in advance? The new non-taxpayer registration tool is an update from last year for IRS non-filers. tool that was designed to allow people to receive stimulus payments even if they don’t have to file a tax return. It allows individuals to provide the IRS with basic information (name, address, and social security number) so that the IRS can calculate and issue their child tax credit advance payments. It will also include information about children under 17, other dependents, and direct deposit information. It is for people who did not file a tax return for tax years 2019 or 2020 and who did not use the IRS economic impact payment tool for non-filers.

The latest updates, including a link to frequently asked questions, are posted on the IRS website at your Advanced Child Tax Credit Payments in 2021 page.

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