Check your child tax credit eligibility before Monday, Aug. 2. Here’s why



The next deadline to unenroll from early child tax credit payments is days away. If you got your first child tax credit payment on July 15 but are having second thoughts, now’s the time to check your eligibility and potentially opt out. Receiving the money early sounds like a good call, but what if you’re not eligible for the advance payments? Take a moment to use the IRS Eligibility Assistant tool to see if you qualify before the next check is disbursed. Advance child tax credit payments can be up to $300 per kid in monthly checks through December. You’ll get the other half during tax time next year. Keep in mind that these prepayments are not a tax deduction, but an actual cash credit.

If you find that you no longer qualify, it’s best to opt out now. (The next opt-out deadline is Monday, Aug. 2.) If you’re not eligible or you get more money than you qualify for, you may have to pay back a portion to the IRS next year. But if you do qualify, you can use CNET’s child tax credit calculator to estimate how much money you’ll get.

We’ll show you how to use the Eligibility Assistant tool, but first, you’ll need your latest tax return and some personal information like your income, filing status and the number of children. Based on your results, you can then use the Update Portal to manage your payment options and get more personalized payment amounts. If you don’t have an account with the IRS yet, you’ll need a bit of time to set one up using ID.me. We’ve recently updated this story.

How do I use the Eligibility Assistant tool to check my child tax credit eligibility?

Before you begin, make sure you’ve got a copy of your 2020 tax return, or your 2019 tax return if you haven’t yet filed your taxes this year (for example, if you filed an extension). If you don’t have a tax return on hand, you can use your filing status and the number of children you claimed, along with an estimate of your total income for 2020.

You can use the IRS Eligibility Assistant tool to answer a few quick questions. If you qualify, you’ll use your tax return and the Child Tax Credit Update Portal to see if you’re enrolled for payments. You can also unenroll — even if you don’t qualify, but got your first check.

Once you’ve figured out what your income was for 2020 or 2019, you can check your eligibility. Here’s how.

1. Go to the Advance Child Tax Credit Eligibility Assistant tool page on the IRS website.

2. Tap or click Check Your Eligibility.

3. You’ll then need to answer a few questions about yourself and your taxes. For instance, the form will ask if you claimed the child tax credit on a previous tax return.

4. You may need to provide additional information, depending on how you answered the questions. Here’s where you fill in your filing status, adjusted gross income and the number of children you claimed on your tax return (along with their ages).

5. After you hit Next, the tool will let you know whether you qualify based on the answers you provided. It’ll tell you the amount each kid under 6 qualifies you for, and how much each kid 6 and older qualifies you for. It’ll also show you the income phaseout details.

6. From here, tap or click Manage your advance child tax credit payments, which will take you to the child tax credit portal that lets you unenroll from the monthly payments if you’d prefer to get one large check instead of several smaller ones, or submit your information if you’re a nonfiler.

Keep in mind that the Eligibility Assistant tool and Child Tax Credit Update Portal do not tell you how much you are eligible for.

What are the 2021 child tax credit eligibility requirements?

Parents may qualify for the full child tax credit payments if they meet one of the following rules outlined by the IRS.

  • $150,000 in total earned income if married and filing jointly
  • $112,500 in earned income if filing as head of household
  • $75,000 in earned income if filing single

If parents meet these income requirements, each dependent under 6 may get up to $300 per month through December and the other half during the 2022 tax season — totaling $3,600. Children ages 6 to 17 may receive up to $250 per month and up to $3,000 total. Dependents ages 18-24 will have to wait until tax time to get the total amount.

If you make more than the income requirements, you may still get advance child tax credit payments, but less than the maximum amount. The IRS subtracts $50 from each advance check for every $1,000 after the income limit. So if you make $85,000 as a single-filer, you may be eligible for up to $200 per month — depending on your child’s age.

There are a few other eligibility requirements for dependents to keep in mind:

  • Must be a US citizen
  • Must be younger than 17 before the last day of the tax year
  • Must be claimed on the parent’s tax return

If you’re unsure of whether or not you qualify based on the requirements, check the Eligibility Assistant tool and update your information using the Child Tax Credit Update Portal. To be on the safe side, you can also opt out and get one lump sum during tax time next year. The next opt-out deadline is Aug. 2, but you can opt out any time between now and December if your circumstances change…Read more>>

Source:-cnet 

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