New child tax credit payments go out this week, IRS weighs in on options
The new child tax credit payments under the American Rescue Plan start going out Thursday July 15, and most American parents will qualify.
The monthly payments will hit bank accounts or come in the mail on the 15th of each month through December. The IRS said depending on how you filed taxes in 2020, determines whether the funds will come through the mail or direct deposit.
The monthly payments are $300 for children under age 6-years-old and $250 for children ages 6-17.
$150,000 or less for married couple
$112,500 or less for head of household
$75,000 or less for the individual taxpayer
The IRS said opting out makes more sense for parents on the cusp of a raise that would affect their income eligibility, but for families who need the money, monthly payments will likely be more beneficial.
The IRS said a divorce can complicate the child tax credit monthly payments, so it's important to be in touch with a professional.
"Whether somebody wants to do that one option or the other, they should consult their tax advisor, see what's best for them, see what works best for their budget," Tax 29 Owner Andrew Reigstand said.
The IRS reminds people these payments are not taxed and are simply an increased advanced payment of the child tax credit already in place.
If you do want to opt out of the monthly payments, you can do here on the IRS website.
IRS Spokesperson Luis Garcia said those who do not have an income still qualify for the child tax credit payments.
Garcia said if you did not file taxes in 2019 or 2020, go to the IRS website to notify the IRS you are eligible to receive payments.
