Another child tax credit payment will go out this week. Here’s what to know
The fourth round of the monthly child tax credit direct payments will go out to eligible families this week.
The temporarily enhanced tax credits — included in the $1.9 trillion American Rescue Plan signed into law by President Joe Biden in March — provide eligible parents with up to $3,600 per child over the course of a year. The first half of the credit will be sent as monthly payments of up to $300 for the rest of 2021, and the second half can be claimed when parents file their income tax returns for 2021.
The first three payments were sent on July 15, Aug. 13 and Sept. 15. Here’s what to know ahead of October’s check.
When will October’s payment be deposited?
The payments will go out Friday, Oct. 15, either via direct deposit or through the mail, to eligible families who have not opted out of receiving the direct payments. It may take longer for checks to arrive through the mail.
Where will the payments be deposited?
Eligible parents can use the Internal Revenue Service’s Child Tax Credit Update Portal to check whether they will receive their October payment via direct deposit or through the mail, and to confirm to which bank account or mailing address the money will be sent.
Parents can also use the tool to change which bank account or mailing address they want the checks sent to — or to enroll in direct deposit if they are receiving paper checks through the mail.
“The IRS urges any family receiving checks to consider switching to direct deposit,” the IRS previously said. “With direct deposit, families can access their money more quickly. Direct deposit removes the time, worry and expense of cashing a check. In addition, direct deposit eliminates the chance of a lost, stolen or undelivered check.”
Oct. 4 was the deadline to make changes for Friday’s payment, but parents have until Nov. 1 to make changes ahead of the Nov. 15 payment.
What to do if you’re missing a previous payment
Eligible families who have not received one of the first three rounds of payments should first check the update portal to make sure they are enrolled in direct payments and that they are being sent to the right place.
Those who don’t receive their missing payments after a certain amount of time can request a payment trace to track their issued payment by mailing or faxing the IRS a completed Form 3911.
The IRS said it can’t track the payment unless it’s been:
▪ Five days “since the deposit date and the bank says it hasn’t received the payment”
▪ Four weeks since the payment was sent through the mail to a “standard address.”
▪ Six weeks since the payment was sent through the mail and there is a forwarding address on file.
▪ Nine weeks since the payment was mailed to an address outside the United States.
The IRS said there were cases in September in which parents who received the first two payments were missing their third payment because of a technical issue. It said Sept. 24 those parents should receive their payments soon.
Additionally, families need to have filed either a 2019 or 2020 tax return to get the monthly payments. Low-income families who do not normally file a tax return can still receive the payments by using the IRS’s non-filer sign up tool.
The tool only remains available until Friday, which is also the last date for most people to file their 2020 taxes.
How to opt out of future payments
Parents have the option to unenroll from the direct payments and instead receive a larger lump sum when they file their taxes for 2021.
Oct. 4 was the deadline to opt out of this month’s payment, but families have until Nov. 1 to use the update portal to unenroll from November’s payment and all future payments. There is not an option to opt back in.
Both spouses need to opt out if married and filing jointly, the IRS said. If one only spouse unenrolls, they will receive half the joint payment they were supposed to receive with their spouse.
The IRS says there are several reasons families may decide against receiving the monthly payments. Parents may want to opt out if they expect the amount of taxes they’ll owe to be more than their expected refund when they file their 2021 tax returns in 2022, the IRS says. The IRS says that by accepting the advance payments, the refund may decrease or the amount owed may increase.
About the child tax credit
The tax credit provides families with $3,600 total per child under age 6 and $3,000 total per child ages 6 to 17.
Single parents earning up to $75,000 a year and couples earning up to $150,000 a year are eligible for the full credit. Benefits are then phased out for higher incomes.
Parents can check whether they’re eligible using the IRS’s Child Tax Credit Eligibility Assistant tool.
This story was originally published October 14, 2021 at 6:39 AM with the headline "Another child tax credit payment will go out this week. Here’s what to know."
