The IRS on Tuesday started an online tool that will allow families to tell the agency they don't want to receive advance monthly payments from the enhanced child tax credit, scheduled to start next month.
Using the new Child Tax Credit Update Portal, families can verify that they're eligible for the credit and unenroll from the advance portion, meaning they won't get the monthly payments set to start July 15 and continue through December. Instead, they'll receive the entire credit as a lump sum when they file their 2021 tax return next year.
The enhanced child tax credit was part of the American Rescue Plan signed into law by President Joe Biden in March. The credit increases to $3,000 from $2,000 per child under the age of 17 and gives an additional $600 benefit for children under the age of 6 for the 2021 tax year.
More from Invest in You:
How to avoid overspending in this hot housing market
How to vet budgeting and investing apps
Monthly child tax credit payments start July 15. What to know
The full credit is available to all children ages 17 and under in families with 2020 or 2019 adjusted gross income of less than $75,000 for single parents and $150,000 for a married couple filing jointly, and ends for individuals earning $95,000 and married couples filing jointly making $170,000, though they'd still be eligible for the regular child tax credit.
Why some families may opt out
Opting out of receiving half of the credit in advance monthly payments makes sense for some families, especially those that may owe the IRS and want to use the credit to offset a tax bill.
In addition, some families with separated parents who share custody may alternate who claims children on their taxes each year. If the parent who claimed dependents in 2020 (or 2019) isn't the one who will claim them in 2021, they can unenroll to ensure the credit goes to the correct guardian.
Others who have income in 2021 that would make them ineligible for the credit but would have qualified in 2020 or 2019 should opt out of the payment so they don't have to pay them back come tax time. And, families that lived or plan to live outside of the U.S. for more than half of 2021 should unenroll from the monthly payments, according to the IRS.
Currently, the tool can be accessed via smartphone or computer. In addition, families without internet access or that can't reach the website for another reason can call the IRS to unenroll — letters the agency sent in June include a phone number.
Updates coming
The IRS plans to update the tool in the coming months to show families their payment history and allow them to change their bank information and mailing address. The agency also plans to release a version of the site in Spanish.
On Tuesday, the IRS also released a tool called the Child Tax Credit Eligibility Portal that can help families determine if they're eligible to receive the credit. These sites are in addition to the Non-filer Sign-Up tool, which debuted earlier in June.
SIGN UP: Money 101 is an 8-week learning course to financial freedom, delivered weekly to your inbox.
CHECK OUT: How to make money with creative side hustles, from people who earn thousands on sites like Etsy and Twitch via Grow with Acorns+CNBC.
Disclosure: NBCUniversal and Comcast Ventures are investors in Acorns.
"payment" - Google News
June 23, 2021 at 02:05AM
https://ift.tt/3qjm7Do
Families can now opt out of advance monthly child tax credit payments starting July 15 - CNBC
"payment" - Google News
https://ift.tt/3bV4HFe
https://ift.tt/2VYfp89
Bagikan Berita Ini
0 Response to "Families can now opt out of advance monthly child tax credit payments starting July 15 - CNBC"
Post a Comment