What it is

If you are among millions of American households with children under the age of 18, you may already be familiar with the Child Tax Credit and how it benefits you when filing your income tax return.

So what’s new this year? As part of the American Rescue Plan, instead of waiting until next year's tax season, eligible individuals will receive 50% of this tax credit as monthly payments. They may then claim the other half when filing their 2021 income taxes.

 

Who is eligible

If you have children under the age of 18 and meet income and other requirements based on your 2020 federal tax return, you may be eligible.

Single filers making up to $75,000 and joint filers making up to $150,000 will receive the full advance amount of $300 per month for each child under the age of 6, and $250 per month for each child age 6 and older.

Higher income thresholds may still qualify for a reduced payment.

For more eligibility answers, visit this IRS Page

 

When to expect it

The Advance Child Tax Credit payments will begin on July 15 and continue through December unless you unenroll.

Why might you choose to unenroll from the Advance Child Tax Credit? It all depends on your 2021 tax situation, so it's best to consult a tax professional about your specific needs. Basically if you expect the amount of tax you owe to be greater than your 2021 tax refund, you may want to unenroll from the advance payments. Otherwise, you may end up owing money to the IRS.

The deadline to unenroll for the 7/15 payment has passed, but you can still unenroll for the 8/13 payment if you do so before 8/2/21

 

How you'll receive it

Similar to the Economic Impact Payments, eligible taxpayers will receive the payment automatically based on the information the IRS has on file. Non-filers who meet eligibility requirements may submit their information via the Non-filer Sign-up Tool.

Payment may arrive via direct deposit, paper check, or prepaid debit card.

Direct deposit

If the IRS sends your payment via direct deposit, it will appear as "pending" in whichever account you provided to the IRS. Although it may show as "pending" prior to July 15, the funds will be made available by the IRS on July 15 or later.

Checks

If you receive a paper check:

  • New! All types of Treasury Checks may now be deposited using Mobile Deposit
  • You may also deposit at any HawaiiUSA branch, ATMs located at HawaiiUSA branches, or use the Night Drop at select HawaiiUSA branches

Prepaid debit cards

The IRS may issue certain payments via prepaid debit card. These cards are mailed in white envelopes that prominently display the U.S. Department of the Treasury seal. It has the Visa name on the front of the Card and the issuing bank, MetaBank®, N.A. on the back of the card.‚Äč 

  • If you received an EIP debit card and want to transfer funds to your bank account or learn more, click here
  • If you mistakenly discarded your EIP debit card, you may reorder one for free. According to the EIP Card website, to order a new card call them immediately at 1-800-240-8100 and select the “lost/stolen” option. The original EIP Card will be deactivated and a replacement card will be sent