Advance Child Tax Credit Payments
- The IRS advance child tax credit payments for 2021 will be 50% of the estimated 2021 child tax credit based on your filing status, AGI, and number of qualifying children reported on your 2020 or 2019 individual income tax return. The actual child tax credit will be calculated on your 2021 individual income tax return for taxpayers with qualifying children and any advanced payments will be reconciled then.
- Please understand that these advance payments you receive may need to be repaid when you file your 2021 tax return next spring, as your actual 2021 filing status, AGI, and/or qualifying children may be different than the filing status, AGI, and qualifying children used to calculate the advance child tax credit payment.
- For 2021 the child tax credit will increase from $2,000 to $3,600 per qualifying child for children ages 5 and under at the end of 2021 and will increase from $2,000 to $3,000 per qualifying child for children ages 6 though 17 at the end of 2021.
- There are two phase-out ranges in which the child tax credit will be reduced by $50 for each $1,000 of your modified AGI that exceeds certain income levels. The first phase-out range will reduce the child tax credit to $2,000 per child. The second phase-out range will reduce the child tax credit below $2,000 per child.
- The advance child tax credit payments will be directly deposited into taxpayers’ bank accounts in monthly installments beginning July 2021.
- You can unenroll from receiving the advance child credit at any time in 2021 if you prefer to wait until your 2021 individual income tax return is filed to receive the credit or if you know that you will not be eligible for the child tax credit on your 2021 individual income tax return. You must opt out three days before the first Thursday of the month in order to not receive that month’s payment.
- You can register to receive the advance child tax credit payment if you were not required to file a 2020 tax return.
- You can find more information, including phase-out ranges for your filing status as well as links to unenroll, register to receive the advance credit payments, and to update your banking information, at https://www.irs.gov/credits-deductions/advance-child-tax-credit-payments-in-2021