Child Tax Credits are an advanced payments of a credit that would be claimed by parents of dependents, but there are a few instances where the parent may need to pay that money back.
Some people opted out of the program so when tax season rolls around, they aren’t stuck paying the money back.
While this is not true for everyone, there may be changes the IRS is not aware of that happened between 2020 and 2021’s tax seasons.
When would I need to pay back the advanced child tax credit payments?
If a spouse makes over $75,000 filing single, or $150,000 is made filing jointly, then money may be owed next year.
If children age out and are 18 for over half of the tax year, the money will also need to be paid back.
Divorce or custody of child could also change if the parent can actually claim those credits.
This years child tax credit will be worth up to $3,600 and the early payments are half of what a person should be getting come April 2022.
To get the credits, the children need to be a U.S. citizen, U.S. national, or U.S. resident alien. They must also have lived with the person claiming the credit for at least half of the year.
The entire credit is refundable this year, while before only $1,400 was refundable.
Related: The next stimulus payment is only 5 days away, make sure you’re ready to get your $300 child tax credit next week
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