Update as of 7/1/2021
The IRS has updated the Child Tax Credit Portal and you are now able to add and update banking information.
We have also been hearing feedback that creating an accounting within the Child Tax Credit Portal can be frustrating and time consuming. We recommend that you create an IRS account here and then access the Child Tax Credit Portal from that account.
Recently, there were changes made to the child tax credit as part of the American Rescue Plan Act enacted in March 2021, that will benefit many taxpayers. You can read more about the specific changes and program qualifications in our previous article.
Though these tax changes are temporary and only apply to the 2021 tax year, they may present important cashflow and financial planning opportunities today. It is also important to note that the monthly advance of the child tax credit is a significant change. The credit is normally part of your income tax return and would reduce your tax liability. The choice to have the child tax credit advanced will affect your refund or amount due when you file your return. To avoid any surprises, please contact our office, we’re here to help you figure out what is best for you and your family.
Taxpayers generally won’t need to do anything to receive any advance payments as the IRS will use the information it has on file to start issuing the payments.
Using the IRS’s child tax credit and update portal, taxpayers can update their information to reflect any new information that might impact their child tax credit amount, such as filing status or number of children. Parents may also use the online portal to elect out of the advance payments or check on the status of payments.
The IRS released a FAQ page about the Advance Child Tax Credit Payment with guidance on topics ranging from Eligibility to Unenrollment from Advanced Payments.
The IRS has also released a non-filer portal to use for certain situations.
With any tax law change, it’s important to revisit your full financial roadmap. We can help you determine how much credit you may be entitled to and whether advance payments are appropriate. How you choose to receive the credit (partially advanced via monthly payments or solely on your next year’s return) could have many impacts to your financial plans.
Please contact us today to discuss your specific situation. As always, planning ahead can help you maximize your family’s financial situation and position you for greater success.