- Advance Child Tax Credit: How To Ensure You Receive Your Monthly $300
- What Are The Advance Child Tax Credit Payments?
- Tax Credit Not A Stimulus Payment
- How Does The $300 Monthly Payment Work?
- Who Qualifies For Advance Child Tax Credit Payments?
- How To Receive Your Advance Child Tax Credit Payment
- IRS Child Tax Credit Sign Up Tool
- How Will The Child Tax Credit Payments Be Sent?
- When Will The $300 Payments Start?
- Can You Opt Out Of The Child Tax Payments?
Advance Child Tax Credit: How To Ensure You Receive Your Monthly $300
In this guide, I will talk about the 2021 Child Tax Credit that will be given to parents.
This tax credit is a monthly payment that families can use to cover monthly expenses for their children like daycare, food, clothing, healthcare, or any other monetary needs.
There is much more to learn about this monthly payment, so continue reading and let’s begin!
What Are The Advance Child Tax Credit Payments?
The Advance Child Tax Credit is a part of the American Rescue Plan that was signed back into law in March 2021. This will consist of cash payments to qualifying families.
Families with children younger than 6 years old will receive a tax credit of $3600. If you have children between the ages of 6 and 17 years old then the tax credit is $3000.
These payments of $3600 and $3000 will be made as monthly payments. For families who qualify for the $3600 tax credit, you will receive $300 per month. For those expecting a $3000 tax credit, you can expect $250 per month.
Tax Credit Not A Stimulus Payment
It’s important to note that this is not a stimulus payment. It is a tax credit.
This is more of an advance on the money that you would have received during tax time next year. What this means is if you elect to receive these monthly payments your tax refund could be smaller next year.
How Does The $300 Monthly Payment Work?
Your tax credit payment will depend on your family size and income.
You will receive a $300 or $250 payment each month in you met income requirements (will discuss shortly) and you have children under the age of 17 years old.
Here is an example…
If you have children who are 3 years old, 4 years old, and a 13 year old, you would receive $850 per month in IRS payments.
You would receive $300 for the 3 year old and another $300 for the 4 year old. The 13 year old would qualify for the $250 monthly tax credit payment. This would give you a monthly total of $850.
Who Qualifies For Advance Child Tax Credit Payments?
Single parents who make less than $75,000 will qualify for the maximum monthly payments. If you are married you will need to make less than $150,000 to receive the maximum advanced child tax credit payment.
Individuals who make $95,000 and couples who make $170,000 can received the monthly payments, although they will be at a reduced amount.
Even if you do not qualify for the advance payments you can still receive the regular child tax credit. This is a $2,000 tax credit for every child under 17 years old. To receive the normal tax credit you will need to make less than $200,000 and $400,000 as a married couple.
How To Receive Your Advance Child Tax Credit Payment
Filing your 2020 tax return will put you in the best position to receive these monthly payments. According to the IRS, if you have filed a 2019 or 2020 tax return and meet income guidelines you will be enrolled in this program.
While you still may be able to receive the monthly payments if you have not done your taxes since 2019, this may delay your payments.
IRS Child Tax Credit Sign Up Tool
The IRS is has created a tool to enable people who have not yet filed their taxes to see if they qualify for the monthly $300 payments.
If you have not filed your 2020 taxes and do not plan on filing then visit the IRS website and use the Child Tax Credit sign up tool to submit all the necessary information.
How Will The Child Tax Credit Payments Be Sent?
Most eligible families will receive their payments via direct deposit. This will work similar to the way stimulus checks have been issued.
If you don’t have direct deposit set up, the IRS will likely mail you a check. Ensure that you update your address so that your check is mailed to the right place.
To update you address you can log into your IRS account.
When Will The $300 Payments Start?
The monthly IRS payments will start on July 15, 2021. After this payment the IRS will deposit $300 or $250 into your account each month on the 15th as long as it’s not a holiday.
The payment schedule for 2021 is:
- July 15th
- August 13th
- September 15th
- October 15th
- November 15th
- December 15th
Can You Opt Out Of The Child Tax Payments?
To opt out of receiving the monthly child tax credits, you will need to use the IRS Sign Up Tool.
You won’t lose the child tax credits that have been discussed if you opt out. You will simply receive them at a later date.
The main reason why you may want to opt out of the advance payments, is if you prefer to receive a large tax refund check at the beginning of the year.
Whether you choose to receive the monthly payments depends on your personal preference.
If you are currently having financial troubles, then the extra $300 could be a saving grace. If you do not want to reduce your yearly refund check, the you may want to consider opting out of this payment.
To learn more about the Advance Child Tax Credit, you can visit the IRS website for all the details.
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Nick Bryant is a Counselor with 11 years of experience working in community health. He enjoys concerts, walks with the doggo and wife, mocking Dallas Cowboy fans, and sharing community resources. Jump on the Houston Case Managers email list to receive weekly community resource guides delivered directly to your inbox.