What you need to know about the 2021 Child Tax Credit

If you claimed a dependent child in 2020, you can probably not only expect a higher child tax credit for 2021, but you may also start getting advanced monthly payments beginning in July of this year. Here’s what you should know:

• The credit has been increased to $3,000 per child ages 6 to 17 and $3,600 per child under 6.
• The full credit is refundable as opposed to previous credits where only $1,400 per child was refundable.
• You can expect to receive half of your anticipated credit in advanced monthly payments beginning in July 2021 through December 2021.
• You will claim any remaining credit on your 2021 tax return.
• The increased credit will begin to phase out for taxpayers with an AGI at or above the following amounts:
• $75,000 for single taxpayers
• $112,500 for head of household
• $150,000 for joint taxpayers

Even if your income does not qualify you for the increased credit, you may still qualify for the original $2,000 child tax credit. If you are concerned about having to pay back the child tax credit due to a change in income, you can elect to receive your full credit on your return and opt-out of the advanced payments by using the IRS online portal scheduled to be launched in July 2021.

Get a sneak peek at your expected monthly payments using our 2021 Child Tax Calculator!

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