What is the Child Tax Credit?
The Child Tax Credit (CTC) is a benefit for parents or guardians with qualifying dependent children to lower their taxes. Because of the COVID-19 pandemic, the American Rescue Plan Act has expanded the CTC to include more families who may need assistance. The benefit is different this year, as families no longer need to wait until they file their taxes in 2022. Families can get a cash “advance” on the CTC through monthly payments beginning July, 2021.
What can I get?
You may be eligible to receive the following based on your income:
- $3,600 ($300 a month) per qualifying child for children ages 0 to 5.
- $3,000 ($250 a month) per qualifying child for children ages 6 to 17.
Am I eligible?
There are two sets of requirements, one for the parent or guardian and one for the child.
To be eligible a child must:
- Have a Social Security number.
- Live with you for at least half of the year.
- Be under age 17 as of December 31, 2021.
Qualifying children include your children, adopted children, stepchildren, half-siblings, foster children, grandchildren, nieces or nephews, or certain other relatives if they meet the requirements above.
To be eligible for the FULL CTC a parent or guardian must:
- Have a Social Security number or an Individual Taxpayer Identification Number
- Have an income below:
- $75,000 for single filers*
- $112,500 for head of households*
- $150,000 for married couples filing jointly*
*Individuals making more than this amount will receive $50 per month less for every additional $1,000 of income earned over the limit.
Will this affect my other public benefit payments?
The CTC does not count as income for SNAP, TANF, MA, SSI subsidized housing or any other federally funded benefits.
How do I access the benefit?
If you filed your taxes in 2020, 2019, or used the non-filer online portal last year to receive the stimulus payment, you should automatically receive the CTC.
If you have not filed your taxes in 2020 or 2019 and did not register for the stimulus payments apply through the CTC Non-Filer Sign-Up Tool. (You may also access the stimulus payments they may be entitled to).
When will I receive my payments?
The IRS will send out advanced monthly CTC payments between July and December 2021. Families should receive $300/month for each qualifying child ages 0-5 and $250/month for each qualifying child ages 6-17. Monthly payments account for half of the 2021 CTC; the other half can be claimed when filing a 2021 tax return.
If you did not receive your first CTC payment and believe you should have, you can check the CTC Update Portal to check your status.
What if I don’t want monthly payments? What if I would prefer a lump sum at the end of the year?
The IRS has a CTC Update Portal that can be used to unenroll or stop getting advanced payments.
What if my child no longer lives with me but I claimed them on my past taxes?
You can go to the IRS website to make sure you do not receive any mistaken payments that you may have to pay back at a later time. The website allows the status of children to be updated multiple times, so if needed you can always re-enroll later.
Where will the money go?
If the IRS already has your bank account information, you will receive the payments through direct deposit.
If you have different accounts or do not have a bank account on file with the IRS you can use the CTC Update Portal to update your information.
Will this always be how the Child Tax Credit is paid?
No. The advanced payments and extra funds are currently only approved for 2021.
Can I use the Non-filer Sign-up Tool to apply for stimulus checks even if I am not eligible fort the Child Tax Credit?
Yes. Use the tool here to access any money you may be eligible for.
I just found this information and it is after July 15 when the payments started OR I didn’t file my taxes by the May 17th deadline! What should I do?
No worries! You can still file and still be eligible for the 2021 Child Tax Credit. Make you sure you file as soon as possible. If needed, free tax assistance is available through Campaign for Working Families.
I still have more questions!
Check out some of these other resources:
https://www.whitehouse.gov/child-tax-credit/
https://cwfphilly.org/resources/child-tax-credit/
https://www.childrensdefense.org/child-tax-credit-resources/