If you have a child or children under the age of 18 in 2021 that you claimed on your 2019 or 2020 tax return, you are auto-enrolled to receive up to $300/month per child for advanced payments of the child tax credit starting July 15. The amount may vary based on the age of your child(ren) and your income. If you meet the income qualifications, children under 6 receive the full amount, whereas children 6-18 will receive payments of $250/month per child. However, it may be in your best interest to unenroll in the advanced payments for the reasons stated below:
- If you make more than $75,000/year and file single, or $150,000/year and file jointly and do not want to pay that money back on your 2021 tax return
- If you are expecting an increase in your income this year that might affect the amount you qualify for and do not want to pay any advanced payments back on your 2021 tax return
- If you would rather receive one large payment as a tax refund to budget for a big expense or outstanding debt
The deadline to opt-out of the first auto payment has passed, but if you would like to opt-out of future payments you will need to click “Manage Advance Payments” on the Child Tax Credit Update Portal and then create an account with the IRS or use your current account login information to unenroll. If you are married filing jointly, you must both opt-out of receiving advance payments. You can also use this portal to add or change your bank account information.
The deadline to opt-out of future payments is three days before the first Thursday of the month to not receive the next month’s payment.