Monthly Child Tax Credit payments are currently being distributed to millions of American families this week. For most, this is their third monthly payment.
Most parents will automatically receive the enhanced credits of $300 for each child up to age 6 and $250 for each child age 6 through 17. The IRS is scheduled to send three more monthly payments in 2021. Half of the amount of the tax credit was split up between all of the payment dates from July through December, with payments made on the 15th of each month. The rest will be deducted on your taxes in 2022. Parents will get the monthly payment automatically by direct deposit or check.
How to Opt Out of receiving Child Tax Credit payments
While it is now too late to stop the check for the September payment, parents can opt out for the rest of the payments by using the child tax credit update portal at the IRS website. The benefit to opting out would be an opportunity for bigger tax deductions on your 2021 return which could lead to a bigger refund in April.
Will Child Tax Credit Payments be extended past 2021?
The expanded monthly child tax credit program was created as part of the government’s $1.9 trillion relief package passed in March and is in effect for 2021 only. Some democratic lawmakers are looking to extend the monthly child tax credit payments through 2025.
What are the household income limits for receiving payments?
Payments from the IRS are available for heads of households earning up to $112,500 a year and joint filers making up to $150,000 at the full amount. For many families, the credit will level off at $2,000 per child and starts to phase out for single parents earning more than $200,000 or for married couples with incomes above $400,000.