Families across the country received their first payment of the Advance Child Tax Credit on Thursday.
You may receive half of the Child Tax Credit for each child in equal payments each month for the remainder of 2021.
- For each qualifying child under age 6, you will receive up to $1,800 in advance, generally paid in six monthly payments of $300.
- For each qualifying child, ages 6 through 17, you will receive up to $1,500 in advance, generally paid in six monthly payments of $250.
These advance payment amounts begin to be reduced if your modified AGI exceeds:
- $150,000 if married and filing a joint return or if filing as a qualifying widow or widower;
- $112,500 if filing as head of household; or
- $75,000 if you are a single filer or are married and filing a separate return.
Families in Connecticut told NBC Connecticut that this is a huge benefit.
“It’s definitely going to be helpful for us as a family just because of all the expenses coming up, with daycare expenses and all the costs associated with that, it’s going to be helpful,” Christine Tardette, a mother from Wethersfield, said.
The Internal Revenue Service (IRS) will automatically opt you in, unless you decide to opt-out and wait to receive the full lump sum when you file your 2021 taxes.
“We as a family decided to defer the tax payments until the very end,” said Mike Rostron, a father from Wethersfield. “We just wanted a lump sum in the end. We’ll probably invest it into something bigger.”
Sara Spodick, the director of the tax clinic at Quinnipiac University School of Law, said opting out might be in your best interest “if they have a particular volatile monthly income and they’re concerned that maybe they’ll have more earnings later in the year or that 2021 is going to look like they have significantly more income than 2020 and 2019.”
If you decide to opt out, you can do that on the IRS website.
That is where people should be able to adjust their income, enter new information about dependents or banking information, according to Spodick.
Any changes you make now should take effect in time for your August payment.
For people who don’t normally file, the IRS website should allow non-filers to register to receive the credit.
“You do need to have information in, on the system with the Internal Revenue Service, so that way they have a way to pay you,” Spodick said.
Spodick also wanted to warn taxpayers about potential scams and said the IRS will never call you and/or ask for personal information.