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Child tax credit 2021: what to do if you haven’t received a payment or received the wrong amount


The first of six monthly payments through the enhanced child tax credit arrived on July 15, most parents of children 17 and under receive one of the down payments. But some parents report that they haven’t received a check yet or received the wrong amount.

The IRS said it sent payments for nearly 60 million children Thursday, for a total of $ 15 billion. But some parents who expected the checks to land in their bank accounts that day were disappointed, either because they didn’t receive any money or because they received less than expected.

Perhaps not surprisingly, some parents are reporting issues with the enhanced CTC, given that the massive new program is determined by a family’s 2019 or 2020 income tax return. The IRS has contacted parents who do not normally file taxes to encourage them to file a simplified return that will qualify them for the program. But other people may run into issues that are not as easy to fix.

“It’s a new thing, and every time you have a big new thing, you have bumps,” said Mark Steber, director of tax information for Jackson Hewitt.

Many of the issues parents face relate to misunderstandings about eligibility, Steber said. This claim was echoed by the IRS, which noted that the phasing out of income and a child’s age could be causes people are receiving less money than expected.

But other issues could also delay some people from getting checks until the end of the year or even until 2022. Here are some of the challenges parents reported, along with possible fixes.

Can I get a check for a child born in 2021?

People who have welcomed children into their families in 2021, whether through birth, adoption or placement, may be eligible for checks, as long as they meet other eligibility criteria. (To learn more about eligibility, click here.) But they would not have received a check on July 15 because the IRS does not yet know of the child’s existence.

That’s because the IRS bases CTC payments on your 2019 or 2020 tax return, whichever is more recent. In either case, the tax agency will not know that you have had a child in the current year.

However, there will be a way to fix this issue soon. The IRS said it will offer families the option to add children born or adopted in 2021 to its Child Tax Credit Update Portal. New parents should continue to check the update portal for the new feature, although it is not clear when exactly it will be added. The IRS says it will be “later this year”.

The IRS sent my check to a closed account

It’s possible that the IRS may have directed your check to a closed or inactive bank account, which is why Steber recommends that taxpayers ensure that the tax agency has the most up-to-date information.

Start by checking out the Child Tax Credit Update Portal, which will provide you with basic information about where the IRS is directing the check, such as your address and bank account. This will alert you if the IRS sends the money either to a closed account or to an old address.

If the IRS sent the check to a closed account, the deposit will be rejected and the tax agency will reissue a paper check and send it to your physical address.

“But if your address on your last tax return isn’t where you want the check, that’s a problem, with no real easy fix at this point,” Steber said. “There is an IRS change of address form, but it takes six weeks” to process, he said.

The IRS Child Tax Credit Update Portal later this year will add a feature for people to update their bank account or mailing address, another addition that people should watch out for if they are. have moved or changed bank account since their last tax return.

I haven’t declared my taxes, will I receive a check?

If you haven’t yet filed your 2020 taxes, the IRS will review your 2019 tax returns to determine your eligibility.

But if you haven’t filed your 2019 or 2020 tax return – there are millions of Americans who don’t have to file taxes because their income is too low to require an annual return – you can’t receive -be no check because the IRS needs some of this information to process CTC payments.

In this case, individuals should access the Child Tax Credit Non-Filers tool to provide information to the IRS that will allow the agency to determine eligibility and send payments.

My child is 5 years old but only received $ 250. Why?

Under the Child Tax Credit, children 6 and under are expected to receive $ 300 per month, while children 6 to 17 will receive $ 250 per month.

But there is a catch: the child must be under 6 years of age by December 31, 2021 to receive the full $ 300 credit. This is because the child tax credit is for 2021, which means that a 5-year-old who turns 6 in the 2021 calendar year will not be eligible for the largest payment.

“A lot of people who have a 5-year-old – say they’ll be 6 in November – say, ‘Why am I getting $ 250?’,” Steber said. “This is not 5 and under in 2021,” but for children under 5 at midnight on the last day of 2021.

My child is 17 years old but I have not received anything. Why?

As with the above issue, the tax law only covers children who are 17 on December 31, 2021. In other words, a 17-year-old who turns 18 in 2021 is not eligible for the CTC.

My tax return has been amended and is still being processed. Is it a problem?

Yes, said Steber. Plus, tax returns that are currently being held for review by an IRS employee – and there’s 35 million of these returns – can also experience delays, he said.

“The IRS has made it clear that you need to have a complete tax return on the IRS system,” Steber said. “If you have a tax return caught in the error resolution system – and there is an abundance of situations that can arise – if it is not fully addressed, we understand that those returns affect prepayments” for the CTC.

In this case, taxpayers can receive payments from the CTC while processing their return. For example, if the return is processed in September, CTC payments could start in October. But if a return is not processed until after the CTC advance payments end in mid-December, the taxpayer will receive the full CTC credit when they file their taxes in early 2022.

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