Child Tax Credit: Do you qualify; do you want to opt out? Check out these tools

Beginning next week, the first of six advance payments of the Child Tax Credit will be sent out to U.S. parents.

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The payments, part of the American Rescue Plan passed in March, will be sent to parents of children up to age 17.

The Internal Revenue Service has launched portals that allow you to see if you qualify for the payments and give you the opportunity to opt out, if you choose, of the advance monthly payments in favor of taking the full credit on your 2021 tax return.

The IRS has also launched a portal to allow those who aren’t required to file a tax return to provide the IRS with basic information for the Child Tax Credit.

Those with dependent children with an income of less than $150,000 (married and filing jointly) will get a maximum of $300 for each child under the age of 6 and $250 for each child ages 6 to 17 in regular payments through December of 2021. The other half of the payments will be seen as a credit on the 2021 tax return.

If you are a parent with a dependent that is 18-24 years old, you are not eligible for advance payments but will be able to use the credit on your 2021 tax bill.

The IRS has sent letters to 36 million families who qualify to get the payments.

The agency plans to send a second letter to confirm that families are eligible for the payment and estimate how much child tax credit money they could receive.

For those with children under age 6, the tax credit is up to $3,600 per child. For children ages 6-17, the credit is $3,000.

To be eligible for the advance Child Tax Credit payments, you — and your spouse, if you filed a joint return — must have:

  • Filed a 2019 or 2020 tax return and claimed the Child Tax Credit on the return; or
  • Given the IRS your information in 2020 to receive the Economic Impact Payment using the Non-Filers tool; and had:
  • A main home in the United States for more than half the year (the 50 states and the District of Columbia) or filed a joint return with a spouse who has a main home in the United States for more than half the year; and have
  • A qualifying child who is under age 18 at the end of 2021 and who has a valid Social Security number; and
  • Made less than certain income limits.

The IRS says no other information is needed, and if you meet those qualifications, you will automatically be enrolled in the advance payment plan.