IRS Starting Monthly Child Tax Credit Payments July 15
The IRS is sending out letters advising families of payments for the new monthly child tax credit. The payments could mean up to $3,600 a year per child for some 36 million families. The first allotments are set to go out starting July 15.
Additional payments will go out August 13, September 15, October 15, November 15 and December 15. Families will receive the remainder when they file their 2021 taxes next year.
Monthly Child Tax Credit Is Early Payments of Tax Help
Deductions are reductions to your income that lower the amount you pay tax on. Credits actually reduce your tax bill. And some of them, like the Child Tax Credit, are refundable if the credit is more than what you owe. These new stipends are an advance payment of the higher credit approved by Congress earlier this year. These payments are completely non-taxable, like the economic stimulus payments given earlier.
Single taxpayers who make less than $75,000 a year will receive $300 a month for each child age 5 and under. They get $250 a month for each child between 6 and 16. For taxpayers using the Head of Household status, the income limit is $112,500, and the limit for married filers is $150,000.
The IRS plans to send a second letter advising the payment amount you can expect. If your income exceeds the limit, you may still qualify for the original Child Tax Credit. That limit is $200,000 in annual income for single filers, and $400,000 for married couples.
The IRS has a webpage that updates regularly explaining the payments.
This article details how non-filers who don’t owe tax can sign up to receive the credit payments.
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