The parents of about 60 million U.S. children are set to receive a second payment under the enhanced federal Child Tax Credit. Some families that missed out on the first check might see their payments kick in this month, while others may need to take action to ensure they get the money.
The expanded CTC was authorized by the Biden administration's American Rescue Plan as a way to help support families during the pandemic. The tax credit was expanded to $3,600 for each child under 6 and to $3,000 for children ages 6 to 17. That's up from a prior credit of $2,000 per child, with half the money distributed in six monthly checks from July through December.
Although most families don't need to do anything special ahead of receiving the payments, some may want to opt out of the monthly installments. (Certain taxpayers may want to claim the entire expanded CTC on their tax returns in early 2022 in order to get a larger refund next spring, for instance. More on that below.) And some families have experienced glitches with the program.
"But by the second payment, your situation should be pretty clear — it's either going as you expected or it's not," said Mark Steber, Jackson Hewitt's chief tax information officer. "The lion's share went very smoothly."
Here's what to know about the second CTC payment.
When does the Child Tax Credit arrive in August?
The second payment date is Friday, August 13. The checks typically arrive on the 15th of each month, but because August 15 is a Sunday, the IRS is sending the money on the 13th.
The U.S. Census Bureau said the checks appear to be having an effect in reducing financial distress for many families. According to a survey by the agency, 57% of parents who received a check spent it on school expenses, while 47% used it for food.
"A drop in the number of households with children that reported food insufficiency and trouble paying household expenses may be linked to the Child Tax Credit checks issued last month," the agency said in an August 11 analysis.
Can I opt out of the August payment?
If you're someone who wants to forgo the cash payments, it's too late to un-enroll from the August payment. The IRS required people to un-enroll from the August payment by August 2 to avoid getting a check on August 13.
However, families can still opt out of payments for the months of September and later. To un-enroll from those payments, you'll need to do so through the Child Tax Credit Update Portal by these dates:
- August 30 for the September payment
- October 4 for the October payment
- November 1 for the November payment
- November 29 for the December payment
I had a child in 2021. Can I enroll?
Yes. Because the CTC is a tax credit for the 2021 tax year, children born in the current calendar year qualify for the payments. But there is hiccup.
Because the IRS is relying on 2019 or 2020 tax returns to determine eligibility, the agency isn't yet sending payments to parents for their children born or adopted in 2021 because it doesn't currently have a record of them.
The IRS says parents will be able to update information about their families, such as the birth of a child, sometime later this year through the CTC Update Portal. Until then, parents should keep an eye on the site to see if that option has been added.
My tax return was amended and I haven't gotten the CTC. What's up?
Some taxpayers whose returns are still being processed by the IRS, including those who amended their returns, may see a delay in getting the CTC payments, Steber said.
"There are several buckets of taxpayers that are unfortunately affected by their current tax status," he said. "One is if you have an amended tax return that hasn't been processed."
The IRS is making headway getting through its vast backlog of returns, Steber added, but there's not much that taxpayers can do. One option is to enroll in the ID.me program through the IRS, which can provide more clarity about your tax situation than other IRS sites, Steber advised. For instance, you should be able to see if you are enrolled and check the status of your payments.
I'm in a "mixed-status" family and didn't get a payment.
Some "mixed-status" families who were banking on getting the first CTC payment last month were disappointed when the money didn't arrive. These are families where one parent is a U.S. citizen and the other is an immigrant with an ITIN number, which is used by the IRS to process tax returns for immigrants without Social Security numbers.
But if their children have Social Security numbers, they qualify for CTC payments (as long as they meet other eligibility requirements, such as age and household income). The IRS said nonpayment for these families was a mistake and payments should begin for these families on August 13.
I'd rather get a big refund next year. Can I opt out?
As noted above, the expanded CTC provides a $3,600 credit for each child under 6 years old and $3,000 for each child age 6 to 17. The monthly payments from July through December only represent half the cash value of the total credit. For example, a family with one child under 6 will receive half of the $3,600 credit in cash, or $1,800, which will be split into six monthly checks of $300 each.
The remainder of the CTC is claimed when you file your 2021 taxes early next year. Some taxpayers who want to get a bigger tax refund in 2022 have asked if they could opt out of the monthly payments and simply claim the entire $3,600 or $3,000 tax credit on their 1040s. The answer is yes, Mark Steber, Jackson Hewitt's chief tax information officer, recently told CBS Moneywatch.
To opt out, taxpayers should go to the Child Tax Credit Update Portal.
Other people may go here if they aren't eligible — such as if their income is higher in 2021, disqualifying them from receiving the payment, or if they are divorced and their ex-spouse is claiming their child as a dependent, instead of themselves claiming that child. (You can find more information on the CTC's age and income eligibility here.)
If you do receive money through the CTC that you aren't eligible to receive, you'll eventually have to pay that back to the IRS next year during the 2021 tax filing season — another reason why some people may want to opt out, Steber said.
"payment" - Google News
August 13, 2021 at 10:40PM
https://ift.tt/3iE8lsJ
Child Tax Credit: Here's when you'll get the August payment - CBS News
"payment" - Google News
https://ift.tt/3bV4HFe
https://ift.tt/2VYfp89
Bagikan Berita Ini
0 Response to "Child Tax Credit: Here's when you'll get the August payment - CBS News"
Post a Comment