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Thursday, June 13, 2024

Monthly child tax credit payments start July 15. Here’s what parents need to know

In just a few weeks, monthly child tax credit payments will go out to U.S. households that are home to about 65 million kids, according to the IRS.

The expanded child tax credit was established in the American Rescue Plan signed into law in March. In 2021, the maximum enhanced child tax credit is $3,600 for children younger than age 6 and $3,000 for those between 6 and 17.

The credit will be distributed as an advance on 2021 taxes in monthly installments. For households getting the full benefit, those payments will be $300 per month for children under the age of 6 and $250 for those between the ages of 6 and 17.

Here's what families need to know ahead of the July 15 start.

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Who qualifies for the maximum credit?

Most American families qualify for some amount of money.

The full credit is available to married couples who file taxes jointly and have children and adjusted gross income less than $150,000, or $75,000 for individuals. The enhanced tax credit will phase out for taxpayers who make more money and cease for individuals earning $95,000 and married couples earning $170,000 filing jointly.

Taxpayers who make more than that will still be eligible for the regular child tax credit, which is $2,000 per child under age 17 for families making less than $200,000 annually, or $400,000 for married couples.

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