Child tax credit 2021 update – Late September payments from the IRS are on their way now

IN THE latest Child tax credit 2021 update, reports say that late September payments from the IRS are on their way now.

The IRS said a glitch in the system this month had caused some payments to not hit their mark on the expected date, said Fox 8 News.

The IRS October opt-out deadline is just days away as the US nears a potential debt ceiling shutdown.

The next chance to opt out for the October child tax credit is October 4 by 11:59pm Easter Time.

Meanwhie, the Biden administration is asking for the debt ceiling to be raised, but if Congress says no to raising it, the US will default on its debt for the first time in its history.

This would mean the loans people take out to pay for things like mortgages, credit cards, car loans, could cost a lot more and a possible government shutdown could occur.

Lending will get more expensive because banks will tighten their spending if more bonds are not released into the market, as banks usually buy the bonds which increases the money supply in the economy and thus makes loans cheap.

The tax credits were expanded from $2,000 to $3,600 earlier this year by President Joe Biden as part of the American Rescue Plan.

Read our child tax credit blog for the latest news and updates…

  • WHEN DO CHECKS GO OUT?

    The Child Tax Credit checks will go out on the 15th of every month until the end of 2021.

    The August checks went out on the 13th because the 15th fell on a weekend.

    If you still have questions or concerns about your Child Tax Credit check, the IRS website may be the best bet, as the agency has limited assistance available due to a backlog of tax returns and delayed stimulus payments

  • MISSING A CHECK – HERE’S WHAT TO DO

    If you did not file taxes, there’s a tool called the Child Tax Credit Non-filer Sign-up Tool where you can add your information to see if you qualify.

    Some 4million households will also be receiving paper checks, as opposed to a direct deposit.

    If the IRS does not have your deposit information, the second check that went out last week may still be in the mail.

    Fortunately, there is an online portal that Americans can use to check the status of their checks.

    You can also verify that the IRS has your correct banking information and see when the last payment was issued.

  • WHO QUALIFIES?

    Single parents or parents who file their taxes as single will qualify for the full checks if they make $75,000 or less.

    If you make more than $75,000, the monthly check is reduced by $50 for every $1,000 over the cap and eventually phases out completely.

    Married couples who file taxes jointly and earn up to $150,000 a year qualify for the full payments, and the same situation applies where the payments eventually phase out.

  • WHY YOU MAY NEED TO OPT OUT

    With the IRS relying on tax returns to determine payments, sometimes the agency doesn’t have the most up-to-date information for you – including how much you earn or the number of children you have.

    This could result in you either receiving payment when you aren’t eligible or receiving less than you’re actually entitled to.

    Others may wish to opt-out to receive a bigger tax credit when they file their taxes next year, while divorced parents with children may wish to opt-out if their former spouse is set to claim their kids on their return.

  • CASHING IN

    Low-income households are no required to file tax returns, meaning some families in need could slip through the cracks when the IRS begins distributing payments next month.

    To ensure all eligible Americans can access the payments, the IRS launched a tool on its website last week to register for the tax credit.

    Non-filers will need to have their Social Security numbers handy, as well as their children’s.

    If they have a bank account, they’ll also need to have their routing and account numbers to hand to use the portal.

  • OVER THE THRESHOLD

    Families who exceed the designated thresholds will still receive some of the enhanced CTC.

    They will be issued $50 less for every $1,000 over an income threshold until the enhanced payments are phased out for people who earn $20,000 more than those thresholds.

    For instance, single filers who earn up to $95,000 and married couples with combined incomes of $170,000 would receive smaller payments, but above that, they would be excluded entirely from the expanded benefits.

    However, families who earn above the thresholds may still qualify for the regular child tax credit.

    The regular CTC of $2,000, taken annually on your tax return, is available to single parents who earn up to $200,000. Married couples earning up to $400,000 also qualify.

    Anyone earning above that threshold doesn’t qualify for any child tax credits.

  • DO I QUALIFY?

    On July 15, around 36 million American families will begin receiving the enhanced CTC payments, accounting for almost 90 percent of the nation’s children.

    Eligible families will receive $3,600 for each child under the age of six and $3,000 for any children aged between six and 17.

    Prior to the CTC expansion, the credit excluded children who had turned 17, and the cash was capped at $2,000 per child.

    Only those who fall below certain income thresholds will qualify.

    That threshold is $75,000 for single tax filers, $112,500 for heads of households, or $150,000 for married couples filing jointly or for qualified widows and widowers.

    Earlier this week, the IRS launched a new tool on its website where you can find out whether you qualify for the benefit or not.

  • NEED TO OPT OUT?

    “If you are getting money and don’t qualify, you need to opt-out of it,” Mark Steber, Jackson Hewitt’s chief tax information officer told CBS. “You will have to pay that money back.”

    Last week, the IRS also raised the overpayment issue, writing on its website: “If you receive a total amount of advance Child Tax Credit payments that exceed the amount of Child Tax Credit that you can properly claim on your 2021 tax year, you may need to repay to the IRS some or all of that excess payment.”

  • BIG CHANGES

    More than 30million households are expected to receive up to $300 per child, starting September 15.

    This will mark the third tranche of payments for the tax year 2021.  

    Families with kids under the age of six will receive $300 per child. Those with kids between ages six and 17 will get $250 for every child.

    Single taxpayers earning $75,000 or less are entitled to the full amount but the payments will phase out by $50 for every $1,000 over that threshold, according to CNET.

    Couples to qualify for the payments need to make less than $150,000.

  • OCTOBER PAYMENTS

    Next month’s payments are then scheduled for October 15. For more scheduled future dates of monthly child tax credit payments, you can take a look here.

    Unfortunately, it’s too late to make information changes with the IRS for this month. However, you can do so for next month’s payments.

  • WHEN DO SEPTEMBER PAYMENTS ARRIVE?

    More than 30million households are set to receive the payments, worth up to $300 per child, starting September 15.

    Families with kids under the age of six will receive $300 per child. Those with kids between ages six and 17 will get $250 for every child.

    To get the full benefit, single taxpayers must earn $75,000 or less. However, the payments will phase out by $50 for every $1,000 over that threshold.

    For couples to meet the benefit requirements, they must make less than $150,000.

    Also, Families with 18-year-olds can claim a one-off $500 stimulus check.

    Dependents between the ages of 19-24 are also eligible for a $500 check, but they must be enrolled in college on a full-time basis.

    The second payment was sent out to families on August 13. Typically, the IRS starts sending out checks to qualifying families on the 15th of each month.

  • WHO SHOULD OPT OUT?

    With the IRS relying on tax returns to determine payments, sometimes the agency doesn’t have the most up-to-date information for you – including how much you earn or the number of children you have.

    This could result in you either receiving payment when you aren’t eligible or receiving less than you’re actually entitled to.

    Others may wish to opt-out to receive a bigger tax credit when they file their taxes next year, while divorced parents with children may wish to opt-out if their former spouse is set to claim their kids on their return.

  • CLAIMING THE CASH

    Low-income households are no required to file tax returns, meaning some families in need could slip through the cracks when the IRS begins distributing payments next month.

    To ensure all eligible Americans can access the payments, the IRS launched a tool on its website last week to register for the tax credit.

    Non-filers will need to have their Social Security numbers handy, as well as their children’s.

    If they have a bank account, they’ll also need to have their routing and account numbers to hand to use the portal.

  • WONDER WEBSITE

    The GetCTC.org tool has recently launched and it’s a mobile-friendly portal to help families claim.

    Rolled out in collaboration with the White House, the US Treasury and Code for America, a nonprofit tech organization, it’s designed to ensure eligible families can easily claim the child tax credit cash they’re due.

    It’s free to use, works on both desktops and mobile devices and is available in both English and Spanish.

    Families are required to file a simplified tax return to get the money. 

  • NON-FILER SIGN UP TOOL

    Those who haven’t filed their taxes because they don’t need to can use the child tax credit non-filer sign-up tool to claim the payment.

    You typically don’t have to file a tax return if you earn less than $12,200 a year as a single taxpayer or $24,400 as a married couple filing jointly.

    However, it does vary depending on age and other factors too so make sure to double-check.

    Eligible families can use the site to give the IRS the information needed – including name, address, social security numbers and bank account details.

  • WHAT IS THE ELIGIBILITY ASSISTANT?

    The advance child tax credit eligibility assistant is the easiest way to check if you qualify for the payments.

    To use it, you need to have filed your tax return for 2020 or 2019.

    The IRS states: “If you don’t have a copy of the return and know your filing status and number of qualifying children you claimed, you may be able to estimate the total income from your tax return to answer all the questions. You can use the following to make estimates:

    • Income statements such as W-2s and 1099s
    • Amount of any expenses or adjustments to your income

    You may still be able to benefit from the credit even if you aren’t working now or didn’t work in 2020.”

  • TAX CREDIT PORTAL

    By updating the IRS child tax credit update portal, families can enroll for direct deposits, change bank account information and mailing addresses.

    Updating your address can be important even if you get the cash as direct deposits because of an IRS letter known as Letter 6419.

    This is sent out to the address you’ve registered, and you’ll need the information on the letter when you file your taxes next year.

    Parents can also use the portal to opt out of receiving monthly payments altogether and instead receive it as one payout next year.

    Sometime late this summer you’ll also be able to make changes to your dependents, marital status and income.

    This is important if your circumstances have changed from your last tax return, which may lead you to be overpaid and having to pay it back.

    Around the same time, you’ll also be able to re-enroll if you’ve previously un-enrolled.

  • HOW CAN I OPT OUT?

    Anyone wishing to opt-out can do so on the IRS’ website via a tool called the Child Tax Credit Update Portal.

    The tool allows people to un-enroll from the tax credit before the first payment is made on July 15.

    The portal will be updated later this year to allow people to see their payment history and change their bank account information or mailing address

  • WHO SHOULD OPT OUT?

    With the IRS relying on tax returns to determine payments, sometimes the agency doesn’t have the most up-to-date information for you – including how much you earn or the number of children you have.

    This could result in you either receiving payment when you aren’t eligible or receiving less than you’re actually entitled to.

    Others may wish to opt-out to receive a bigger tax credit when they file their taxes next year, while divorced parents with children may wish to opt-out if their former spouse is set to claim their kids on their return.

  • WHAT IF YOU’RE A NON-FILER?

    Low-income households are no required to file tax returns, meaning some families in need could slip through the cracks when the IRS begins distributing payments next month.

    To ensure all eligible Americans can access the payments, the IRS launched a tool on its website last week to register for the tax credit.

    Non-filers will need to have their Social Security numbers handy, as well as their children’s.

    If they have a bank account, they’ll also need to have their routing and account numbers to hand to use the portal.

  • MAKE MORE THAN THE THRESHOLD BUT HAVE KIDS

    Families who exceed the designated thresholds will still receive some of the enhanced CTC.

    They will be issued $50 less for every $1,000 over an income threshold until the enhanced payments are phased out for people who earn $20,000 more than those thresholds.

    For instance, single filers who earn up to $95,000 and married couples with combined incomes of $170,000 would receive smaller payments, but above that, they would be excluded entirely from the expanded benefits.

    However, families who earn above the thresholds may still qualify for the regular child tax credit.

    The regular CTC of $2,000, taken annually on your tax return, is available to single parents who earn up to $200,000. Married couples earning up to $400,000 also qualify.

    Anyone earning above that threshold doesn’t qualify for any child tax credits.

  • DO I QUALIFY FOR CHILD TAX CREDIT PAYMENTS?

    On July 15, around 36 million American families will begin receiving the enhanced CTC payments, accounting for almost 90 percent of the nation’s children.

    Eligible families will receive $3,600 for each child under the age of six and $3,000 for any children aged between six and 17.

    Prior to the CTC expansion, the credit excluded children who had turned 17, and the cash was capped at $2,000 per child.

    Only those who fall below certain income thresholds will qualify.

    That threshold is $75,000 for single tax filers, $112,500 for heads of households, or $150,000 for married couples filing jointly or for qualified widows and widowers.

    Earlier this week, the IRS launched a new tool on its website where you can find out whether you qualify for the benefit or not.

  • DO I HAVE TO PAY BACK CHILD TAX CREDIT?

    With stimulus payments, eligible Americans didn’t have to repay the IRS if they received more funds than were meant to.

    But that isn’t the case for CTC payments, however.

    “If you are getting money and don’t qualify, you need to opt-out of it,” Mark Steber, Jackson Hewitt’s chief tax information officer told CBS. “You will have to pay that money back.”

    Last week, the IRS also raised the overpayment issue, writing on its website: “If you receive a total amount of advance Child Tax Credit payments that exceed the amount of Child Tax Credit that you can properly claim on your 2021 tax year, you may need to repay to the IRS some or all of that excess payment.”

  • PARENTS WITH JOINT CUSTODY

    Parents who share joint custody of their kids are eligible to get expanded child tax credits payments under President Biden’s Covid-19 relief package.

    Every household with children that qualified for the latest $1,400 stimulus check is set to receive the child credit cash.

    Such households include couples who earn less than $150,000 or an individual who earns less than $75,000.

    Families with children under the age of six are eligible for up to $3,600 in payments per child.

    Those with kids aged between six and 17, meanwhile, will be eligible for $3,000 in credit for each qualifying child.

    Additionally, those with dependents between the ages of 18 and 24 who are enrolled in college full-time can receive $500 for each.

    The temporary change to the credit provides families with up to $1,600 more per child than previously, helping to cover family expenses, clear debts and other costs.

  • WHEN WILL I GET IT?

    The cash is automatically set up to be issued monthly from July until December and the second half will then land in bank accounts next year.

    The monthly checks of $250 to $300 will start from July 15, unless you opt out.

    If you do opt out, keep in mind you’ll then only receive the lump sum in 2022 after the IRS processes your 2021 tax return.

    The full payment will arrive with your tax refund, or it could be used to offset any taxes you owe.

    An online portal will be set up in July so taxpayers can get the credit when they file their income taxes and opt out of advance payments.

    As of now, the credit is set to expire in 2022.

    However, as part of his joint address to Congress in April, President Biden spoke about plans to expand $3,600 child tax credits until 2025.

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