Advance Child Tax Credit: What CU Members Should Know

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The monthly Advance Child Tax Credit from the U.S. Treasury Department (via the IRS) is being sent to eligible U.S. taxpayers starting this month and going through December. Is your credit union and its members ready?

Important changes to the traditional Child Tax Credit will help many families get advance payments of the credit starting this summer. The IRS will pay half the total credit amount in advance monthly payments beginning July 15. Eligible taxpayers will claim the other half when they file their 2021 income tax return next year. These changes apply to tax year 2021 only.

To qualify for Advance Child Tax Credit payments, your members — and their spouse, if filing a joint return — must have:

  • Filed a 2019 or 2020 tax return and claimed the Child Tax Credit on the return; or
  • Given the IRS their information in 2020 to receive the Economic Impact Payment using the Non-Filers: Enter Payment Info Here tool; and
  • Have a main home in the United States for more than half the year (the 50 states and the District of Columbia) or file a joint return with a spouse who has a main home in the United States for more than half the year; and
  • Have a qualifying child who is under age 18 at the end of 2021 and who has a valid Social Security number; and
  • Has made less than certain income limits.

The IRS will use information your members provided earlier to determine if they qualify and automatically enroll them for advance payments. They do not need to take any additional action to get advance payments.

Credit union members can manage their payments, check if they're eligible, and access additional information here. Additionally, they can directly access the Eligibility Assistant tool.

For more IRS resources and guidance on the topic, click here.

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