Tax Corner

Advance Child Tax Credit payments in 2021

In an attempt to reduce the poverty rate among millions of low-income families, the Biden Administration has increased the Child Tax Credit (CTC) from $2,000 up to $3,600 for qualified taxpayers. It will help many families get advance payments of the credit starting this summer.

The IRS will payout half of the total credit amount in advance monthly payments beginning July 15. You will claim the other half when you file your 2021 income tax return. These changes apply to tax year 2021 ONLY.

If you are qualified, you may be eligible to receive up to $1,800 ($300 monthly) for each child under the age of six and $1,500 ($250 monthly) for each child six to seventeen. Below are the qualifications to receive the advance CTC payments:

  • You must have filed a 2019 or 2020 tax return and claimed the Child Tax Credit on your return.
  • You must have resided in the United States for more than six months in 2019 or 2020.
  • If your filing status is married filing jointly, your adjusted gross income must not exceed $150,000
  • If your filing status is head of household, your adjusted gross income must not exceed $112,500

Where is My 2020 Tax Refund?

As late as July 29, 2021, millions of taxpayers are still waiting for their 2020 tax refunds. The IRS is backlogged for a number of reasons. They include the COVID-19 pandemic, the stimulus payments, and the advance child tax credit payments. According to the Taxpayer Advocate Service, as of last month, there are more than 16 million returns that have not been processed by the IRS.

If you have not received your tax refund, then it is likely that your return is caught up in the IRS backlog. Unfortunately, your only recourse is to use the IRS website to check the status of your refund. You may also contact the IRS directly, however, the wait time is extremely long and more often that not, the person you speak with is unable to provide you with additional information. Use the link below to check the status of your refund. You will need to enter three pieces of information; therefore, be sure to have a copy of your return handy.