Unsure of how much your first payment of the child tax credit will be? Use this quick calculator to figure out your total (and more).
Eligible parents are scheduled to get their first advance child tax credit payment this Thursday — either through direct deposit or a paper check. If you have children under 6 years old, you could get up to $300 a month per child, or up to $250 per month for each kid aged 6 to 17. But the partial payments are just for this year — the other half of the child tax credit will come when you file your taxes in 2022. Dependents 18 to 24 years old could potentially qualify for one payment during tax season next year.
If your most recent direct deposit information isn’t on file with the IRS, you’ll need to use one of its child tax credit portals to give the tax agency your details as soon as possible. Note that direct deposit may not be automatic — some members of a Reddit forum said their first child tax credit payment is coming in the mail despite the IRS having their banking info. Parents should sign in to the IRS site and portal to double-check that the IRS has and is using their banking info. Before July 15, you can double check if you qualify based on your family’s income and the ages of your children. If you’d prefer to get one large payout next year for the full amount (that’s up to $3,600 per kid), you might then choose to opt out of the monthly payment program.
We’ll explain how the math and other requirements work in determining your family’s credit amount. The IRS has been sending out letters to parents to let them know whether they qualify. We can also tell you how to sign up with the IRS to manage your child tax credit payments and let you know what to expect during tax season next year. This story gets regular updates.
Calculate your family’s total child tax credit payment
Start here by entering your adjusted gross income and number of kids. (Our calculator will not store or use your data.) The results are based on our current knowledge of the law and should be treated only as broad estimates; the IRS will determine the final amount. We suggest consulting a financial professional if you want a more personalized estimate.
The child tax credit math is somewhat involved this time around. Let’s say the above calculator says that you will receive $3,500 in monthly payments from July through December 2021. That means you should take that total and divide by six to see how much the IRS will send you each month in advance this year alone.
Here are the basic rules. For parents of eligible children up to age 5, the IRS will pay up to $3,600, half as six advance monthly payments and half as a 2021 tax credit. For each child ages 6 through 17, the IRS will pay up to $3,000, divided in the same way this year and next. For dependents age 18 or full-time college students up through age 24, the IRS will make a one-time payment of $500 in 2022.
If your AGI is $75,000 or less as a single filer, $112,500 as a head of household or $150,000 filing jointly, you’ll get the maximum amount. If your income is above the threshold for your filing status, your child tax credit payments will begin to phase out by $50 for every $1,000 of income over it. So, if the calculator above gives you a figure much less than $3,600 total for your 3-year-old, that probably means your household income is too high for the full payment.
Timeline for child tax credit payments in 2021 and 2022
The first child tax credit payment starts on July 15 and continues through next year. Here’s a breakdown of when payments will be deposited and the maximum amount to expect based on the age brackets. ReadMore
Source : cnet