With the first payment of the child tax credit going out next week, the IRS is updating its two portals to help eligible families sign up for payments and receive them straight to their bank accounts. The 2021 credit means parents can now get up to a $3,000 credit for every child age 6 to 17, and up to $3,600 for every child under age 6, with half of the total credit split into recurring payments each month in advance of next year.
How do the IRS portals help? One eligibility tool helps households figure out whether they qualify and for how much (use CNET’s calculator to check as well). An additional nonfiler tool is crucial to help families that don’t typically file taxes to register for the credit. An update portal gives parents the option of unenrolling from the advance monthly payment program or updating their personal details, including their bank account info, so they can get the checks through direct deposit.
Once you know you qualify, the update portal will be key to making sure you get the right amount of money this year and next. To use it, you’ll need personal documents on hand to sign in with ID.me (we can provide some guidance for navigating the site). The update portal lets you opt out of the monthly payments if you prefer a large payout instead of smaller recurring checks, and it’s also useful if you’re worried about how the credit could affect your taxes next year. We have recently updated this story.
Manage child tax credit payments and check eligibility
Most families who qualify for the expanded credit don’t need to take any action if they want the advance payments this year. If you already filed a 2019 or 2020 federal income tax return (or used the non-filer tool in 2020 to register for a stimulus payment), you’ll get the credit automatically. And the credit is nonrefundable, so you don’t need income to get it.
The online tools are useful for a variety of reasons. Here’s how they help parents with eligible dependents:
- The Child Tax Credit Update Portal lets you verify that your family qualifies for the credit and opt out of receiving any payments in 2021. (The next deadline to opt out is Aug. 2.) In the coming months. you’ll be able to use this portal to view your payment history, update your mailing addresses and inform the IRS on changes in family status, dependents and income.
- A nonfilers portal lets you provide the IRS with basic information about yourself and your dependents if you normally aren’t required to file a tax return. The tool is intended to help low-income households register for the payments.
- The Child Tax Credit Eligibility Assistant can help you determine whether you qualify for the advance child tax credit payments.
What other toolkits and resources are available now? The IRS regularly updates its child tax credit FAQ page. White House has launched a website for the child tax credit that provides an FAQ for families, details about eligibility and more downloadable information.
As part of a broader effort to raise awareness of the 2021 child tax credit, the agency has also provided a list of free tax days in 12 select cities, including Los Angeles and New York. Through July 10, tax days will provide eligible families with help to prepare and file their 2020 tax returns so that they can automatically receive the advance payments.
Unenroll from this year’s advance monthly checks
The Child Tax Credit Update Portal now lets you opt out of receiving the monthly child tax credit payments. That means that instead of receiving monthly payments of, say, $300 for your 4-year-old, you can wait until filing a 2021 tax return in 2022 to receive the $3,600 lump sum.
To do so, visit the Child Tax Credit Update Portal and tap Manage Advance Payments. You’ll then need to sign in with your IRS username or ID.me account. (You can create one on the page if you don’t have one.)
After you sign in, if you’re eligible, you’ll see an option to opt out of the payments.
You can opt out at any time, but note that you must opt out at least three days before the first Thursday of the month you’re opting out of. For the July 15 payment, you needed to opt out by June 28. At this point, the IRS says unenrolling or opting out is a one-time action, and that you won’t be able to opt back in until late September. The next unenroll deadline is Aug. 2.
You may want to unenroll in the advance monthly payment program because you’re expecting your circumstances to change or if the partial monthly payments will interfere in tax planning. Families that usually owe money to the IRS when they file their taxes may want to instead use the full credit next year. Or you might choose a larger payout if your household is saving for a big expense next year.
Register with the nonfiler tool if you don’t typically file taxes
The child tax credit Non-filer Sign-up Tool is a way for those who aren’t required to file a tax return to give the tax agency basic information on their dependents. This tool can be used by low-income families that earn too little to have filed a 2020 tax return but that need to notify the IRS of qualifying children born before 2021.
With the nonfiler tool, you’ll be able to electronically file a simple tax form with the IRS with enough information for the agency to determine your family’s eligibility for the advance child tax credit payments. You shouldn’t use this tool if you are required to file a tax return but just haven’t yet. Also, don’t use this tool if you actually filed a 2020 tax return or if you claimed all your dependents on a 2019 return.
To use the tool, families must have a primary residence in the US for more than half the year. To register, parents should have their personal details on hand, including an email address, Social Security numbers for dependents and a bank account routing number.
Heads-up: The IRS recommends using the portal on a laptop or desktop computer, not on a phone. While the tool is not mobile-friendly, according to the Washington Post, you can access it from a browser on your smartphone. In addition to requiring an email address, you need to know your filing status and other tax-related information, which as a nonfiler, you may not have readily available. The tool is also not available in Spanish. (We’ve contacted the IRS about the tool being available in languages other than English.)
The IRS provides some guidance on how to fill out the form as a nonfiler. Note that it can take up to 48 hours for the IRS to confirm your email address — and another 48 hours after submitting your information for the IRS to accept it.
1. To get started, create an account if you don’t yet have one. You’ll need an email address to confirm your information.
2. On the next page — named “Fill Out Your Tax Forms” — enter your information, including your filing status and details about dependents. Because this portal is an update to the tool nonfilers used to claim stimulus checks, you can add information about those payments, called “Recovery Rebate Credit” on the form. Add your banking information to receive your payments electronically instead of in the mail. Tap the Continue to Step 2 button when ready.
3. On this page — named “E-File Your Tax Forms” — you’ll provide your adjusted gross income, or AGI, and sign the form electronically. (Here’s more on how to do that.) When done, tap the Continue to E-File button to submit your information.
Use the Eligibility Assistant tool to verify qualifications
The new Child Tax Credit Eligibility Assistant allows families to answer a series of questions to quickly determine whether they qualify for the advance credit. This can be helpful for families who haven’t received a letter from the IRS confirming their eligibility.
Correct your direct deposit and bank information
Using the Child Tax Credit Update Portal, you can now add your direct deposit information if the IRS doesn’t have it from a recent tax return. The IRS said it will use what it has on file for the first payment on July 15. If the IRS doesn’t have your bank account information, it will send the July check in the mail.
To receive the remaining payments to your account starting in August, add your direct deposit information using the portal by Aug. 2, the IRS said.
Update the IRS on any changes to income or kids
Later this summer, you’ll be able to indicate changes to any life circumstances since you last filed your taxes, such as a change in income, an addition to your family or child custody status. For example, if you started making less money this year, you’ll want to update the IRS about those changes so you can get the correct child tax credit amount.
If you had or will have a new baby this year, it’s important to let the IRS know, so you can receive your payment for up to $3,600 for that child. The same applies if you adopted a child or if you gained a new child dependent since you last filed your taxes.
Also, if you’ve gained full custody of your child, you’ll be the parent who receives the money for your kid. Note that parents who have shared custody will not each get a payment. This is important for domestic violence survivors, according to comments during an IRS oversight hearing by Nina Olson, executive director of the Center for Taxpayer Rights. The “change of circumstances portal should allow them to enter their change in marital status and also where the children are,” Olson said.
How to get child tax credit checks without a permanent address
The IRS is urging people to share information about the child tax credit with others who don’t have permanent addresses. By doing this, you’re helping make sure families receive the payments they’re eligible for. You can share information about the online portals and resources with them so they know about the programs to help them file a tax return.
Read more on income requirements and age qualifications for the expanded child tax credit.
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