With the next advance child tax credit payment coming up in two weeks, the IRS has launched a new tool that allows parents to update some of their financial information, KTLA sister station WJW reports.
For the change to take affect by the Nov. 15 payment, parents will need to update their information by 8:59 p.m. PT Monday. Once the update is made, the IRS will adjust the remaining tax credits.
Those unable to make the changed by the deadline can do so by Nov. 29 to have them reflected in the December payment, which is the final installment of the monthly child tax credit. The remaining amount will be paid out in a lump sum after the recipient’s 2021 tax return is filed.
The new tool could lead to some families qualifying for a bigger payment.
For instance, if you get monthly payments below the maximum and you experienced job loss during 2021 or for other reasons are receiving substantially less income this year, you could qualify for more money. Reporting that change now — instead of when you file taxes — may increase the amount of your advance payments for the rest of this year.
For married couples, if one spouse makes the income update, it will apply to both spouses and could impact both their future payments.
On the other hand, some parents could see their child tax credit amount shrink.
Households who saw a substantial increase in their income this year should consider having their payments reduced — especially if they are currently getting the maximum payment each month but anticipate qualifying for less than the entire credit after filing their 2021 tax return, according to the IRS.