12/07/2021
Hello and Happy Tax Tuesday!
As many of you know, the government increased the child tax credit for individuals with children under the age of six from $2,000 to $3,600 and $3,000 for children ages 6 through 17 (dependent on income thresholds below). A notice was sent in June that gave eligible individuals the option to receive 50% of their Child tax credits in advance via monthly payments starting July 15th through the end of the year. This means now that the end of the year is here, the last Child tax credit payment is approaching to hit on December 15th. You can check your child tax payments by clicking the link below, keeping track will allow you to make sure you receive the full Child tax credit that you are eligible for when filling your 2021 taxes.
https://www.irs.gov/credits-deductions/child-tax-credit-update-portal
Although the 2021 child tax credits are coming to an end, The House of Representatives passed the Build Back Better Act on November 19th. This bill includes many budget and spending provisions for the future, one of them being the extension on the child tax credit through 2022. Taxpayers whose adjusted gross income does not exceed $150,000 as joint filers, $112,500 as head of household, $75,000 filling single or other, are eligible for these payments.
The regular child tax credit still has an income threshold of $400K but now includes children who were under the age of 18 by the end of the year where it used to be for children under 17. So you get an extra year of child tax credits regardless of whether you qualify for the supplemental Child Tax Credit or the regular one.
The IRS is scheduled to send out letter 6419 in January. This letter will list each qualifying child along with the payments that were sent out from July through December. Please make sure to keep this letter if you receive it and bring it to your accountant when you go file your 2021 taxes.
The above is for information and entertainment use only. Please consult with your CPA for advice on your specific situation. Feel free to contact me with any questions or comments. See you next Tuesday 😀.
Check if you're enrolled, manage your payment information and unenroll from advance payments of the 2021 Child Tax Credit.