The first monthly payment of an expanded and newly advanceable child tax credit (CTC) from the American Rescue Plan will be made on July 15, the U.S. Treasury Department and the IRS jointly announced Monday.
The monthly payments are expected to go to roughly 39 million households — covering 88% of America’s children — without any further action required, the agencies said in their statement.
The increased CTC payments will be distributed on the 15th of each month, unless the 15th falls on a weekend or holiday. That will allow families who receive the credit by direct deposit to plan their budgets around receipt of the benefit, the agencies said.
Eligible families will receive a payment of up to $300 per month for each child under age 6 and up to $250 per month for each child age 6 and older.
The American Rescue Plan increased the maximum Child Tax Credit in 2021 to $3,600 for children under age 6 and to $3,000 per child for children between ages 6 and 17, the statement said. The plan is projected to lift more than 5 million children out of poverty this year, cutting child poverty by more than half.
Households covering more than 65 million children will receive the monthly CTC payments through direct deposit, paper check or debit cards, according to the statement. Treasury and the IRS pledged to maximize the use of direct deposit to ensure faster and more secure delivery.
While most taxpayers will not be required to take any action to receive their payments, Treasury and the IRS will continue outreach efforts with partner organizations over the coming months to make more families aware of their eligibility, according to the statement.
Monday’s announcement represents the latest collaboration between the Bureau of the Fiscal Service and the IRS — and between Treasury and the White House American Rescue Plan Implementation Team — to ensure help quickly reaches Americans in need as they recover from the COVID-19 pandemic.
Since March 12, the IRS has also distributed approximately 165 million Economic Impact Payments with a value of approximately $388 billion as a part of the American Rescue Plan.