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Child Tax Credit Payments

Advanced child tax credit payments begin July 15th for qualifying families (qualifications discussed below). The opt-out date for the first payment was June 28th. You can still opt-out of future payments according to the table from the IRS below.

Payment Month Unenrollment Deadline Payment Date
July 6/28/2021 7/15/2021
August 8/2/2021 8/13/2021
September 8/30/2021 9/15/2021
October 10/4/2021 10/15/2021
November 11/1/2021 11/15/2021
December 11/29/2021 12/15/2021
Source: IRS

Why might I want to opt-out of the payments?

As a reminder, these payments are an advance of the child tax credit for the 2021 tax year. When taxes are filed in 2022, any payments received will be applied to the child tax credit. If your adjusted gross income (AGI) is over the threshold of:

  • $150,000 if married and filing a joint return or if filing as a qualifying widow or widower;
  • $112,500 if filing as head of household; or
  • $75,000 if you are a single filer or are married and filing a separate return. (Source: IRS)

then the tax credit will be reduced to $2,000 per child and begin to completely phase out by $50 per $1,000 of AGI over $400,000 for married filing jointly and $200,000 for all other filing statuses.

If you expect your income to exceed either of these thresholds, then you might consider opting-out of the remaining advanced payments. Otherwise, your refund in 2022 will be reduced, or the taxes you owe will be increased by the amount of payments you received in advance that you did not in fact qualify for. If you are unsure of what you should do, we can help answer any questions you might have, just give us a call. In addition, we offer comprehensive tax planning services to help minimize tax liability. This can be especially advantageous for individuals when selling off high-value investments or property, or for business owners.

How much are the child tax payments?

For 2021, the child tax credit was increased from $2,000 per child to $3,600 per child 5 and under through 2021, and $3,000 per child 6 to 17 through 2021. Half of the credit is being distributed as monthly payments. This means monthly per child payments are:

  • 5 and under: $300
  • 6 to 17: $250

Where do I opt-out?

You can find out if you are set to receive advanced payments or unenroll from payments on the IRS website by clicking the link below.