Expanded Child Tax Credit

The American Rescue Plan expands the Child Tax Credit (CTC) to provide more financial support for families throughout 2021. Details are below. 

Under the American Rescue Plan, the Child Tax Credit is enhanced in the following ways for 2021: 

  • The maximum credit is increased from $2,000 to $3,000, with an additional $600 for each child under the age of six, and extends the full credit to 17 year old children.
  • The increased amount phases out at $150,000 for married taxpayers filing jointly, $112,500 for heads of households, and $75,000 for individual filers. 
  • The CTC is fully refundable for 2021. As a result, if the maximum CTC would be greater than your tax liability, you will receive the excess from the IRS. 
  • The IRS will send out funds on a periodic basis starting this July until December 2021, instead of making families wait until tax season to claim the credit. Families should receive about half of the benefit of the CTC by December, and then they claim the rest on their 2021 tax return. 
  • If you’ve filed tax returns for 2019 or 2020, or if you signed up to receive a stimulus check from the Internal Revenue Service, you will get this tax relief automatically. You do not need to sign up or take any action.
  • If you didn’t make enough to be required to file taxes in 2020 or 2019, you can still get benefits. Families with low-incomes and children are eligible for this crucial tax relief – including those who have not made enough money to be required to file taxes. Non-filers can sign up for the Child Tax Credit by using the IRS Child Tax Credit Non-filer Sign-up Tool.
  • The CTC is extended to families in Puerto Rico and other U.S. territories. 

Frequently Asked Questions

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What is the Child Tax Credit?
The Child Tax Credit is a tax benefit to help families who are raising children.

How will the Child Tax Credit give me more help this year?
The American Rescue Plan, signed into law on March 11, 2021, expanded the Child Tax Credit for 2021 to get more help to more families.

  • It has gone from $2,000 per child in 2020 to $3,600 for each child under age 6.
  • For each child ages 6 to 16, it’s increased from $2,000 to $3,000.
  • It also now makes 17-year-olds eligible for the $3,000 credit.
  • Previously, low-income families did not get the same amount or any of the Child Tax Credit. Under the American Rescue Plan, all families in need will get the full amount.
  • To get money to families sooner, the IRS will send you half of your 2021 Child Tax Credit this year, starting in July.
  • It will be broken up into monthly payments, which means payments of up to $300 per child under age 6 and $250 per child ages 6 to 17.
  • You’ll get the remainder of the credit when you file your taxes next year.

Will I keep getting the expanded credit amounts and the advance payments next year?
The American Rescue Plan enacted these historic changes to the Child Tax Credit for 2021 only. That is why Senator Murray and many others strongly believe that we should extend the increased Child Tax Credit for years and years to come.

Do I qualify for the Child Tax Credit?
Nearly all families with kids will qualify. Some income limitations apply. For example, only couples making less than $150,000 and single parents (also called Head of Household) making less than $112,500 will qualify for the additional 2021 Child Tax Credit amounts. Families with high incomes may receive a smaller credit or may not qualify for any credit at all. For more detail on the phase-outs for higher income families, see “How much will I receive in Child Tax Credit payments?”

If you have any questions about your unique circumstances, visit irs.gov/childtaxcredit2021.

Do I need to do anything to make sure I receive my payments?
Most families won’t have to do anything at all to receive the Child Tax Credit payments. If you filed taxes this year (your tax return for 2020), filed last year (your tax return for 2019), or if you signed up for Economic Impact Payments (commonly called “stimulus checks” or “stimmies”) using the IRS’s Non-Filer tool last year, you’re all set and the IRS will automatically send you monthly payments.

If you did not have to file your taxes this year or last year, and you did not register for Economic Impact Payments last year, you can still sign up for the Child Tax Credit payments. The good news is that through the IRS Non-filer Sign-up Tool you can also apply for any Economic Impact Payments (“stimulus checks”) that you’re entitled to but may not have received yet.

Can I use the Non-filer Sign-up Tool to apply for Economic Impact Payments (“stimulus checks”) even if I am not signing up for the Child Tax Credit?
Yes. If you haven’t filed taxes in a while and have not yet received the Economic Impact Payments (“stimulus checks”) that you were eligible for, you can use the Non-filer Sign-up Tool to apply for them whether or not you are also applying for Child Tax Credit payments. See “I haven’t filed taxes in a while. How can I receive this benefit?” to see if the Non-Filer Sign-up Tool is for you.

I received the Child Tax Credit for a child on my 2020 taxes (filed in 2021), but they no longer live with me. What should I do?
If you will not be eligible to claim the Child Tax Credit on your 2021 return (the one due in April of 2022), then you should go to the IRS website to opt out of receiving monthly payments using the Child Tax Credit Update Portal. Receiving monthly payments now could mean that you have to return those payments when you file your tax return next year. If things change again and you are entitled to the Child Tax Credit for 2021, you can claim the full amount on your tax return when you file next year.

If you have any questions about your unique circumstances, you should visit irs.gov/childtaxcredit2021.

When will I start receiving my monthly payments?
People who receive payments by direct deposit will get their first payment on July 15, 2021. After that, payments will go out on the 15th of every month. (In August the payment will go out on August 13th since the 15th falls on a weekend.) If you haven’t provided the IRS with your bank account information on a recent tax return, a check will be sent out to you around the same time to the address the IRS has for you.

How much will I receive in Child Tax Credit payments?
Most families will receive the full amount: $3,600 for each child under age 6 and $3,000 for each child ages 6 to 17. To get money to families sooner, the IRS will send families half of their 2021 Child Tax Credit as monthly payments of $300 per child under age 6 and $250 per child between the ages of 6 and 17. 

This amount may vary by income. These people qualify for the full Child Tax Credit:

  • Married couples with income under $150,000
  • Families with a single parent (also called Head of Household) with income under $112,500
  • Everyone else with income under $75,000

These people will qualify for at least $2,000 of Child Tax Credit, which comes out to $166 per child each month:

  • Married couples with income under $400,000
  • Families with a single parent (also called Head of Household) with income under $200,000
  • Everyone else with income under $200,000

Families with even higher incomes may receive smaller amounts or no credit at all.

Where will the IRS send my money?
The IRS will send your payments by direct deposit to the bank account they have on file. If they don’t have bank account information for you, a check will be mailed to you.

What if I want to give the IRS new bank account information?
You will be able to add or change your bank account information on the IRS website in the coming weeks, through the IRS’s Child Tax Credit Update Portal.

Can I get all of the Child Tax Credit in a lump sum when I file my 2021 taxes instead of getting half of it in advance monthly payments?
Yes, you can opt out of monthly payments for any reason. To opt-out of the monthly payments, or unenroll, you can go to the IRS Child Tax Credit Update Portal. If you do choose to not receive monthly payments, you’ll get the full Child Tax Credit as a lump sum next year when you file your tax return. 

I haven’t filed taxes in a while. How can I receive this benefit?
You may be eligible for Child Tax Credit payments even if you have not filed taxes recently. Not everyone is required to file taxes.

This year, Americans were only required to file taxes if they earned $24,800 as a married couple, $18,650 as a Head of Household, or $12,400 as a single filer. If you had total income in 2020 below those levels, you can sign up to receive monthly Child Tax Credit payments using a simple tool for non-filers available on the IRS’s website.

Will I lose out if I can’t sign up in time to get a payment on July 15?
No. Everyone will receive the full Child Tax Credit benefits they are owed. If you sign up for monthly payments later in the year, your remaining monthly payments will be larger to reflect the payments you missed. If you do not sign-up in time for monthly payments in 2021, you will receive the full benefit when you file your tax return in 2022.

Where can I find a computer and printer in Washington state to fill out IRS forms?
You can use the Washington Secretary of State library search website to find a public library near you.

For more information, visit the IRS page on Child Tax Credit.

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