Millions of parents across the U.S. can expect to receive some extra cash this week, when the IRS will start distributing the fifth round of payments from the expanded child tax credit.
Roughly $15 billion has been sent to 36 million families, the Treasury Department and IRS said in a joint statement. The money is expected to reach some 60 million children.
The monthly installment, worth up to $300 per child, will be issued via direct deposit for most families beginning on Nov. 15, part of a program authorized as part of the stimulus bill that Democrats passed without any Republican votes in March.
Low- and middle-income parents can expect to receive $3,000 for every child ages 6 to 17 and $3,600 for every child under age 6 under the expanded child tax credit. The payments are income-based and begin to phase out for individuals earning more than $75,000 and married couples earning more than $150,000. The tax credit is tapered by $50 for every $1,000 a family makes over the income thresholds.
If families earn too much to qualify for the sweetened tax credits, they can still receive the $2,000 credit for their children if their income level is below $200,000 for individuals and $400,000 for married couples.
There’s no limit on the number of children who can receive the credit per family.
You can use this free calculator from Omni to see how much money you can expect to receive.
The IRS is distributing half of the credit as an advance on 2021 taxes in six monthly installments, worth $250 to $300 per child. The remainder will come when parents file their 2021 tax returns next April.
If families would prefer to receive a lump-sum payment when they file their tax return in 2022, they can use this tool unveiled by the IRS in June.
Parents who have provided the IRS with their bank account information in order to receive a tax refund will receive the payment via direct deposit. Otherwise, parents can expect to receive the money as a paper check.
Families also can check the Child Tax Credit Update Portal to see how the money will arrive. They can also sign up for direct deposit or change their bank account through the portal.
The IRS began paying out the credit on July 15. From there, the agency has delivered the monthly payments on the 15th of each month through December 2021.
There is only one more payment date scheduled for this year, on Dec. 15. The remaining half will be a credit toward next year's taxes. Any money left after covering taxes will be paid directly to families.
To stop the advanced payments, families must use drop out using the IRS's new online portal three days before the first Thursday of the next month, according to the agency. The deadline to opt out of the fifth round of payments has already passed, but families can still drop out of future payments using the new online portal from the IRS. The opt-out date for the December payment is Nov. 29.