Some parents are seeing delays with their first child tax credit payment or incorrect amounts.
Sarah Tew/CNETWhile millions of eligible US families received their first child tax credit payment in July by direct deposit and mail, many parents are still waiting for their check to arrive. Some families reported they got the wrong amount, while some families with an immigrant spouse didn't receive their payment due to an IRS glitch. If you fall under one of these circumstances, find out how much you should get with our child tax credit calculator.
One possible problem is the child tax credit is getting disbursed on a monthly basis this year, so the IRS is using the most recent tax return on file. That could cause an issue if your family never submitted its tax return, or if the tax information is now outdated because of a new child or a different income. It could also be a simpler issue of the IRS not having your correct banking information. If that's the case, we can show you how to fix it using the IRS portals, although it may be too late for the August payment.
The IRS Update Portal allows you to check your payment history, verify eligibility and unenroll from the monthly checks if you're worried about owing money to the IRS next year. And heads up, to use the portal you may need to create an ID.me account if you haven't already. Keep reading for answers to common child tax credit problems, including if if you think you need to file a trace for a missing payment. We have recently updated this story.
1. My family is eligible, but I haven't got any money. What happened?
If you qualify for the enhanced credit but haven't received your payment, there could be a number of reasons why. If you filed your taxes, check the Update Portal to see if payment is coming by mail. If so, give it several business days to arrive. If you have direct deposit set up, make sure all the information is accurate. Note: If you haven't set up your banking details yet, you should expect the July and August payments to come as paper checks.
If everything looks correct but you still didn't get a payment, you may need to file a payment trace with the IRS. To do that, you'll need to complete Form 3911 (PDF) and mail or fax it to the IRS. Only do this if it's been at least five days since the scheduled deposit date, or four weeks since the payment was mailed by check.
2. I didn't file a tax return, but my family qualifies for 2021 payments. What now?
The IRS is using your 2019 or 2020 tax return to determine child tax credit eligibility. If you didn't file taxes, you may still be eligible for advance payments -- you'll just have to complete an extra step. You can use the IRS nonfiler portal to register for future payments. If not, the IRS may not have the most updated information, especially if you've had a child since then. It's best to sign up as soon as possible to start getting payments if you qualify.
Reasons you didn't get a child tax credit payment
| The problem | What to do |
|---|---|
| You didn't file a 2019 or 2020 tax return. | Use the IRS nonfiler portal. |
| Your payment is coming in the mail. | Give it time to arrive as it could take several days. |
| You can't find any reason why you didn't get a payment. | It may be time to file a payment trace with the IRS. |
3. The IRS portal says I don't qualify, but I still got money. Why?
With the IRS sending out millions of child tax credit payments, along with keeping up with income tax refunds and unemployment tax refunds, it's certainly possible the agency could have made a mistake. For instance, some people who weren't qualified for the stimulus checks still received payment.
If you're absolutely positive you're not eligible for the enhanced child tax credit payments but you got a payment anyways, you'll need to return that money to the IRS. Start by using the IRS Update Portal to unenroll from future payments -- the next deadline to opt out of the monthly payments is Aug. 30. This will help prevent you from having to pay back more money when you file your taxes in 2022.
On the other hand, some members of a Reddit forum are reporting that despite the child tax credit portal showing they aren't eligible, they do meet the requirements and did receive their first payment. We've contacted the IRS for more details on this situation.
Watch this: Child tax credit: Everything we know
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4. How do I know if my child tax credit payment was direct deposited rather than mailed?
Aside from checking the IRS portal to see if it shows that your payment was issued, you can check your bank account for the deposit. According to the White House website, transactions will contain the company name "IRS TREAS 310" with a description of "CHILDCTC" and an amount for up to $300 per kid. Don't get this deposit confused with those for stimulus checks, which show up as "TAXEIP3" when deposited. Also, if you're waiting on a tax refund, it'll show up as "TAX REF."
5. Will I have to pay the IRS next year for child tax credit money I get this year?
If you're eligible for the full amount of child tax credit money, you won't have to pay it back. However, if you don't qualify for the full amount because of a change in your income or number of dependents but receive the full amount anyway, you may need to pay back that extra money.
The IRS is using what it calls "payment protection" so if you do receive an overpayment but fall below a set income level, you don't have to pay back an overpayment. Above that income level, you will have to pay back some or all of the extra money. Here's more on the income levels and how the payment protection works.
The next child tax credit check will be disbursed on Aug. 13.
Sarah Tew/CNETWill the child tax credit become permanent?
As of right now, the enhanced payments are for this tax year. That means after you get your final payment with your tax refund in 2022, the child tax credit will revert back to its original amount from previous years, which was lower. However, it's possible President Joe Biden and Congress could come to an agreement to extend the payments in 2025 -- or make the changes permanent. Last week, Biden said he is urging Congress to do that: "I say to my colleagues in Congress: This tax cut for working families is something we should extend, not end, next year."
While no decision has been made yet, we'll keep you updated on the outcome.
For more information, here's how to opt out of future child tax credit payments. Also, here's how to track down your child tax credit payment if you didn't receive it. Not sure you got the right amount? Use CNET's child tax credit calculator to see how much you should get.
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