Advance Child Tax Credit Payments
All of this information and more can be found on the IRS website. Click the button to go there now.
Your tax team will be staying on top of this information as well. Call or email your office for more information.
The Child Tax Credit (CTC) Advance Payments are monthly payments from the IRS. They are an estimated advance on Child Tax Credit payments that taxpayers may be eligible for on their 2021 tax returns. These payments will total no more than 50% of the total CTC from 2021 tax return, but are based off information reported to the IRS on 2020 tax returns – if not filed yet, they will use 2019 tax information. These payments will be sent out starting in July, and run through December 2021.
No action is needed on your end unless you want to opt out (or unenroll from) of these payments or if you are behind on filing your taxes. If you are not required to file taxes, the Non-Filer Tool can be used to let the IRS know your eligibility. That tool can be found by clicking the button below. Once on the IRS website, click the blue button “Use the Non-Filer Sign Up Tool” at the bottom of the page.
If you are eligible for these credits, the IRS will send you a letter showing what your estimated payment amounts will be. The letter also gives additional information about these advanced payments. Many eligible taxpayers have already received this letter. If you have not yet, it is coming!
At this time, the IRS is not anticipating delays on 2021 refunds due to these Advanced Payments. However, that may change as things progress and develop. We will know more as it gets closer to tax time.
These payments may also be subject to any garnishments.
Keeping Track of Payments
If you would like to keep track of payment amounts and dates received, you absolutely can. However, the IRS has stated that they will be sending out notices in January 2022 showing the total amounts paid out in these advances. BRING THAT LETTER IN WITH YOUR TAX PAPERWORK as we’ll need to report the payments to the IRS to avoid extra credits taken.
Unenroll/Opt-Out of Payments
You can unenroll from these payments if you wish. You must do so by 3 days before the first Thursday of the month by 11:59pm EST. See the chart below for dates.
If you choose to unenroll from these payments and you file Jointly with another taxpayer, you will BOTH need to go through the process to unenroll. If only one taxpayer unenrolls, the IRS will still issue payments equal to half the total payment sent.
It can take up to 7 days for the unenrollment request to be approved. The IRS is recommending that taxpayers check back at their account to verify that their request has been approved.
Advance Child Tax Credit Update Portal (CTC UP)
This portal will be the lifeline for taxpayers and preparers as we navigate these payment distributions and reconciliations. It can be found here.
Currently, we can opt out of receiving these payments, see a list of payments scheduled, and update banking information. Additional features are expected to be added throughout the summer. See the chart below for the additional features this portal will be able to offer with anticipated time frames.