Parents, check your bank accounts on Friday August 13th. Then the second installment of child tax credit prepayments is earmarked for direct deposit. If the IRS doesn’t have your direct deposit information, you will receive your payment by check.
With the first round of child tax prepayment, bank and credit unions customers generally had funds available at 9 a.m. local time.
How much are the payments?
Parents with children under the age of 6 receive a total of $ 3,600 in credit. Half of these payments will be made in monthly installments of $ 300 per month over six months, while the remaining $ 1,800 will be paid in credit when you file your tax return in 2022.
The credit for children ages 6-17 is $ 3,000. Parents will receive $ 250 per month for six months and the remaining $ 1,500 for the next year at tax time.
How do I know if I qualify?
If you received the first round of child tax credit in July, you should receive the remaining four payments. You are entitled to full credit for every dependent child who turned 17 on December 31, 2021. The credit begins to expire at the following income levels:
- $ 75,000 for single filers
- $ 112,000 for Head of Households
- $ 150,000 for married couples filing a joint statement
A child is considered to be dependent if you pay more than half of the maintenance for the tax year.
You can use the Child Balance Update Portal on the IRS website to verify that your payment has been scheduled. The IRS also sent letters to 36 million families telling them they were eligible for the loans before the first payments were sent out in July.
What if i haven’t received the first credit?
If you haven’t filed taxes for 2019 or 2020 and haven’t received the stimulus checks, you may need to use the non-filer tool to register.
There are several other circumstances in which you need to take action. For example, if you had a child in 2021, you will need to register to receive prepayments. Otherwise, you’ll have to wait and get full credit when you submit the return next year. If you had a child in 2020 but the IRS used your 2019 reimbursement to determine your balance, you may need to log in as well.
There is currently no way to add dependents. However, the IRS says it will offer an option on its website later this summer to do so.
When do I get the other 4 payments?
The remaining four payments will be made according to the following schedule, according to the IRS.
- September 15th
- Oct 15
- 15th of November
- 15th December
Can I cancel the child loan in advance?
Parents can opt out of receiving the advance credits if they would rather get a larger tax refund next year. If your income was below exit thresholds in 2020 or 2019, but you expect it to be above these levels in 2021, you may want to opt out of prepayments to avoid having some of the money repaid in the next year.
It’s too late to unsubscribe from August Balance, but you can use the update portal to unsubscribe from future prepayments. The September 15th deadline for deregistering payments is August 30th.
Robin Hartill is a certified financial planner and senior writer at The Penny Hoarder. She writes Dear Penny, a personal financial advisor. Send your tricky money questions to [email protected]