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Is your family eligible for the $ 3,600 child tax credit? Income rules and age requirements

By on June 7, 2021 0

The improved payments will put more money in the bank of qualified households.

Sarah Tew / CNET

Mark July 15th on your calendar. This is when eligible families will automatically receive their first advance. payment of the child tax credit, with monthly payments for half of the total amount continuing through 2021. However, like anything tax-related, the rules for the child tax credit are somewhat complicated. We can help.

There are income thresholds for getting the payments, and your dependents must be of a certain age conditions. Newly increased payments in 2021 are $ 300 per month per child, or $ 3,600 in total per child during this year and next year. Including babies born in 2021. Another key element to know: the advance monthly payments are optional, so that parents can choose instead to receive the full lump sum when they file their taxes in 2022.

According to a White House fact sheet, the American Family Plan could extend the new child tax credit in the future. We will keep you posted. Here’s what’s going on with potential fourth dunning check, what to do if you have not received your third dunning check, when it could come and how to follow it. This story has been updated.

Families receive a total of $ 3,600 for each child under 6

If your dependents are under 6, you can claim up to $ 3,600 per child as long as you meet the income requirements, which are listed below. That’s $ 1,600 more than the $ 2,000 parents could claim on their 2020 income tax return.

This includes newborns, even if they were born later in 2021. Before next month, parents will be able to update the IRS with their new dependent information in a online portal in order to start receiving advance payments this year. Otherwise, parents can file a claim on their 2021 tax return next year.

Age groups for the 2021 child tax credit

5 years and under

Up to $ 3,600 per child, with half the credit in monthly payments of $ 300

6 to 17 years old

Up to $ 3,000 per child, with half credit in monthly payments of $ 250

18 years old

Single check of $ 500 in 2022

19 to 24, full-time students

Single check of $ 500 in 2022

Families receive a total of $ 3,000 for each child aged 6 to 17

If your dependents are 6 years of age or older, you will be entitled to up to $ 3,000 per child over the next year, assuming you meet the income requirements. This includes your dependents who are 17 years old. In previous years, parents could only claim a maximum of $ 2,000 for each dependent aged 16 and under.

You can also get money for your older children, although it is not that much. You can claim up to $ 500 for an 18-year-old, as well as full-time students aged 19 to 24.

People earning $ 75,000 or less (or couples earning $ 150,000 or less) will receive the full amount

As long as your adjusted gross income, or AGI, is $ 75,000 or less, single parents will be eligible for the full amount of the child tax credit. After $ 75,000, the amount begins to gradually disappear. At $ 240,000, single filers completely eliminate the tax credit.

If you are married and filing jointly with your spouse, your AGI must be $ 150,000 or less to be eligible for the full amount of the child tax credit. At $ 440,000, couples will phase out the tax credit.

The credit gradually decreases by $ 50 for every $ 1,000 of income above the thresholds for all filers, according to Joanna Powell, CEO of CBIZ.

2021 Child Tax Credit Income Limits

Who qualifies

What the law says

Sole depositor

An AGI of $ 75,000 or less to be eligible for the full amount

Head of household

An AGI of $ 112,500 or less to be eligible for the full amount

Joint deposit

An AGI of $ 150,000 or less to be eligible for the full amount

Not declaring

Will have to file a 2020 tax return to get payment

Heads of household earning $ 112,500 or less are eligible for the full amount

As the head of the family, your AGI will need to be $ 112,500 or less to be eligible for the full amount of the child tax credit. The amount you could get starts to disappear if your income exceeds that amount, and by $ 240,000 you are phasing out the tax credit.

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People who typically don’t file taxes may be eligible, but …

Even if you don’t usually file taxes – you are considered a non-declarer – you will have to file a return to be eligible for the 2021 child tax credit. Payments will be automatic for those who filed their 2020 income tax returns before May 17, so if you have not submitted your return income at that time, the IRS will not be able to send you a payment.

By July 1, the IRS will open two separate online portals. One of the portals will be crucial for households that do not traditionally file their income taxes so that they can register their information. Households who have gained new dependents since filing their income tax return should update their information in the portal to ensure they are receiving the amount owed to them.

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Some eligible families may choose to receive the full $ 3,600 per child in one lump sum next year.

Sarah Tew / CNET

More eligibility rules for receiving new child tax credit checks

  • The child you are claiming must live with you for at least six months out of the year.
  • You and your child must be U.S. citizens, unlike mixed-status households.
  • For married couples filing jointly, at least one of the spouses must have a Social Security number or ITIN.
  • The child must also have a social security number – a child with only an ATIN will not be eligible. (This includes adopted children.)
  • Parents who share custody of a child cannot both benefit from the tax credit.

Here’s what else to know about the 2021 child tax credit.

Important: The results here are based on our current knowledge of the law, but should be treated as general estimates only. Consult a financial planner for a more personalized estimate.