Child tax credits: IRS unveils tool to prevent families from missing out on monthly payments

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A U.S. Treasury check and $100 bills are seen in a file photo. (iStock/Getty Images Plus)

A U.S. Treasury check and $100 bills are seen in a file photo. (iStock/Getty Images Plus)

With the first batch of child tax credits set to be dispersed in July, the IRS this week launched a new tool to help low-income families sign up for the monthly payments.

The free tool allows people who normally don’t file income taxes — or didn’t for 2019 or 2020 — to provide the federal tax agency with the basic information required to calculate and issue the child tax credits, according to the IRS’s website.

“We have been working hard to begin delivering the monthly Advance Child Tax Credit to millions of families with children in July,” IRS Commissioner Chuck Rettig said in a statement. “This new tool will help more people easily gain access to this important credit as well as help people who don’t normally file a tax return obtain an Economic Impact Payment.”

Unveiled Monday, the online tool is an updated version of the one that helped non-filers register to receive the stimulus checks from the three federal COVID-19 aid packages.

Those who signed up with the previous non-filers tool don’t need to go through the process again.

However, people who missed out on but were eligible for the last round of economic payments can also use the tool to receive the $1,400 payment, according to the IRS. Additionally, it can also be utilized by any non-filer who may still be owed stimulus money and wishes to claim the recovery rebate credit.

The first advance child tax credits will be distributed on July 15. The payment dates for the rest of the year are Aug. 13, Sept. 15, Oct. 15, Nov. 15 and Dec. 15. The final six payments can be claimed in a taxpayer’s 2021 return.

Earlier this month, the IRS sent letters out to some 36 million Americans who, based on their tax filings, may qualify for the enhanced tax credits.

Those who are eligible will receive up to $300 per month for each child under the age of 6, and $250 per month for each child between the ages of 6 and 17, according to the IRS.

The total payments — $3,600 and $3,000 annually — are more than the previous child tax credit that amounted to $2,000 per child.

Like the stimulus checks, taxpayers qualify for the entire amount if their income is $75,000 or less for single filers, $112,500 or less for heads of households, or $150,000 or less for married couples filing jointly, and qualified widows or widowers.

Those whose yearly earnings are higher will receive reduced amounts.

The advance payments are part of the American Rescue Plan, which was authorized by Congress and signed into law by President Biden in March.

More information about the tax credits can be found at IRS.gov/childtaxcredit2021.

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