Psst, parents! IRS Sends Letters About Your Child Tax Credit Money
An unexpected letter from the IRS usually triggers panic, as did a colleague who thought the envelope was an audit notice. But if your household received a letter from the tax office this week (or if you receive one next week), it should bring a sigh of relief. This is the newfor 2021 and how you might be eligible to start receiving early monthly payments on July 15. The same letter was sent to 36 million homes in the United States.
As much as 92% of families with children – that’s 65.6 million children – could . New rules this year will increase the annual child tax credit from $ 2,000 to a maximum of $ 3,600 per child. In addition, unlike in previous years, half of the total payment amount will be distributed automatically in partial installments until the end of 2021. (Parents will also have the option of to receive the lump sum when filing income tax next year.)
We’ll explain what the letter will and won’t tell you, and why you should keep an eye out for a second letter from the IRS regarding your child tax credit audits. (We’ll also tell you what to do if you don’t receive a letter.) You can also use CNETto estimate your payments and find out more about .
What is the first IRS Child Tax Letter of Credit?
Congratulations. If a letter that looks like this arrives in the mail … (see directly below)
… that means the IRS thinksfor the next child tax credit, based on the information it has from your 2019 or 2020 tax return – or details you filed in to get your .
Until there is a check in hand or a direct deposit in your bank account, it is not a good idea to take this letter as a guarantee of an upcoming child tax credit payment. but it looks like your chances are good. As with all IRS correspondence, keep this letter for your records.
So what is the second IRS letter for?
If, in fact, you get the go-ahead from the IRS to receive child tax credit payments (which begin July 15), you will receive a second letter confirming your eligibility. It also indicates how much money you should expect to see in those checks.
The 2021gets a bit tricky from there, but the result is that half of the total money will come in increments from July through December, with the remaining money coming to you after your tax return in 2022.
You will want to keep this letter so that you can compare the estimate with what you will eventually receive and ensure you get the right amount for the right number of children you are claiming. If there is a problem with the delivery of the child tax credit check, this letter is almost like your receipt from the IRS, which you may need to reference in the future (such as in a request to collect your taxes. 2021 next year).
What to do if you don’t receive a letter from the IRS
If a letter never appears in your mailbox, that doesn’t necessarily mean the IRS is ignoring you for child tax credit payments. After all, the vast majority of American households with children will receive some of the money reserved for parents.
For example, while 36 million families are supposed to receive a letter, up to 39 million households may be eligible for the credit. This immediately means that 3 million households could see a check, but no confirmation letter.
You may not receive a letter if the IRS:
What you can do now:
To learn more about the Child Tax Credit, here’s how you’ll uselaunch by early July and what if you have .