Find out if your family's children are eligible for the 2021 child tax credit.Sarah Tew/CNET
Starting in July, you could begin receiving monthly child tax credit payments for your qualifying kids. If you're eligible, you could get up to $300 per month for each child (depending on their age) with the expanded child credit that's part of the $1.9 trillion stimulus bill. If you've got a child 5 years old or younger, you could get up to $3,600 per child over 2021 and 2022 -- and that includes babies born in 2021. If you have a kid between the ages of 6 and 17, you could get up to $3,000. (Calculate your total here.)
It's possible the payments could also get extended to 2025 if President Joe Biden's American Family Plan proposal gets approved. Right now, the details can get confusing over which dependents and families qualify for the child tax credit and how much money you can expect to receive once the benefit checks start to arrive (unless you opt out).
We've got additional qualifications and details you'll need to know, and we'll address those below. Here's some extra information on a potential fourth stimulus check, what to do if you haven't received your third stimulus check, when it could come, how to track it and how to see what could be causing a delay in your stimulus payment. Also, you could get up to $50,000 back with one-time COVID credits. This story was recently updated.
Parents with children ages 5 and under could see $3,600 per kid over the next year
If your dependents are below the age of six, you can claim up to $3,600 per child as long as you meet the income requirements, listed below. That's $1,600 more than the $2,000 that parents were able to claim on their 2020 tax returns.
This includes newborns, even if they're born later in 2021. The parent filer would likely be able to update the IRS portal with their new dependent information to begin receiving the advance payments this year, said Garrett Watson, a senior policy analyst at Tax Foundation. Otherwise, parents can file a claim on their 2021 tax returns next year. However, anything can change from now until the IRS provides us with more information and gets the portal up and running -- the IRS hasn't set a specific timeline for that yet.
Child Tax Credit 2021 qualifications
|What the law says|
|An AGI of $75,000 or less to qualify for the full amount|
|An AGI of $112,500 or less to qualify for the full amount|
|An AGI of $150,000 or less to qualify for the full amount|
|Credit for $3,600 each if parent/guardian meets above requirements|
|Credit for $3,000 each if parent/guardian meets above requirements|
|Will need to file a 2020 tax return to get the payment|
Parents with children ages 6 and older are eligible for $3,000 per kid
If you have dependents who are ages six or older, you'll qualify for up to $3,000 per kid over the next 12 months, assuming you meet the income requirements (refer to the chart above). This includes your dependents who are 17 years old -- originally, parents could only claim up to $2,000 for each dependent age 16 and younger.
You can also get money for your older kids, although it's not nearly as much. You can claim up to $500 for an 18-year-old, as well as for full-time college students ages 19 to 24.
Here's what parents who share custody of a qualified dependent should know.
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Single filers who have an AGI of $75,000 or less are eligible for the full amount
As long as your adjusted gross income (also known as AGI) is $75,000 or less, single taxpayer parents will qualify for the full child tax credit amount. After $75,000, the amount begins phasing out.
The credit phases out by $50 for every $1,000 of income over the threshold amounts for all filers, according to Joanna Powell, Managing Director at CBIZ.
Heads of household with a $112,500 AGI meet the requirements
As a head of household, your AGI will need to be $112,500 or less to qualify for the full CTC amount. The amount you could get begins phasing out if your income is over $112,500.
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Married couples filing together who surpass this AGI amount may get a partial payment
If you're married and filing jointly with your spouse, your AGI needs to be $150,000 or less to qualify for the full CTC amount.
Will you still qualify for the new child tax credit even if you don't file a tax return?
Even if you don't usually file taxes -- you're considered a nonfiler -- you'll need to file a return to qualify for the 2021 child tax credit. IRS Commissioner Charles Rettig said that payments will be automatic for those who file their 2020 tax returns by May 17, so if you don't have your tax return submitted by this time, the IRS won't know to send you a payment.
It's also important to file a return in case you've gained new dependents since you last filed. That way you can get the full CTC amount you're due.
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Other 2021 child tax credit qualifications you'll need to meetThe child you're claiming must live with you for at least six months out of the year.You and your child must be US citizens, unlike the mixed-status households. For married couples filing jointly, at least one spouse needs to have a Social Security number or an ITIN, Powell said. The child must also have a Social Security number -- a child with only an ATIN won't qualify. (This includes adopted children.)Parents who share custody of a child cannot both get the tax credit.
Important: The results here are based on our current knowledge of the law, but should be treated as broad estimates only. Consult a financial planner for a more personalized estimate.
For more information, here's everything you need to know about the 2021 child tax credit and when your payments could start arriving.