Firm News

Beginning in July, families claiming the child tax credit will receive up to $3,000 per qualified child ages 6 to 17 (must still be 17 years old on December 31, 2021) and $3,600 per qualified child under 6 years old, as of December 31, 2021. Advance payments will be estimated based on eligible taxpayer’s 2020 tax return. The payments will begin being made in July through December 2021. Advance payments for qualified children ages 6 to 17 can be up to $250 and up to $300 per qualified child under the age of 6.

The IRS will be sending letters to families who may qualify and a second letter to those who do qualify and a list of estimated monthly payments they’ll receive. Phase –out begins at $150,000 for married filing joint and qualified windows or widowers, $112,000 for Head of Household and $75,000 for all other tax payers.

The IRS is planning to add a tool to allow families to unenroll from receiving the advance payment and who would prefer to receive the full tax credit on their 2021 tax return.  In the case you receive more in advance payments than you were entitled to you may be required to pay it back. For those taxpayers with lower and moderate-income there are safe harbor rules to limit the amount you have to pay back.