Opt-out of child tax credit payments can prevent some families from having to pay the IRS at the end of the year
Parents who apply must opt out of receiving any more monthly payments before the end of August
They warn that some families could be left owing cash to the Internal Revenue Service (IRS) if they do not exclude themselves from the deadline for upcoming Child Tax Credit payments before the end of August, The Sun reported.
Eligible families who want to receive their entire child tax credit in one lump sum when they file their 2021 taxes next year can opt out for the $ 250 or $ 300 monthly payments.
Some families may owe money to the IRS
Likewise, for parents who increased their income in 2021 or have a child who can be claimed by someone else as their dependent, the opt-out can prevent them from owning money to the IRS at the end of the year.
However, families must choose to pause their payments before the end of August if they want to stop monthly payments from September. “Eligible families who make this decision will continue to receive the remainder of their Child Tax Credit as a lump sum when they file their 2021 federal income tax return next year,” according to the IRS website.
They must stop payments before the end of August
“To stop all payments starting in September and the rest of 2021, they must be canceled before 11:59 pm ET on August 31, 2021,” the tax agency said. To stop payments, parents must use the unenrollment feature on the Child Tax Credit Update Portal.
According to the IRS, for married couples, each spouse will have to unenroll separately because if only one spouse drops out, the family will continue to receive monthly payments but for less.
Some families in the US will receive another stimulus check for $ 1,400
The American Rescue Plan Act of 2021, also called the COVID-19 Stimulus Package or President Joe Biden‘s American Rescue Plan, provided direct payments of $ 1,400 to most Americans, and families also received checks for $ 1,400. for each dependent.
Many eligible families whose children were born in 2021 did not receive the money as the children were not born when the stimulus money was distributed. However, these families will not run out of their due money but will likely have to wait until the next tax return to claim that additional $ 1,400 stimulus check.
Additional stimulus check will be sent to some families
Since the Internal Revenue Service (IRS) has no way of knowing if a taxpayer has had a baby, families will need to notify the agency when they file their 2021 tax returns to inform the new dependent, he said. WBFF.
The only way a family can claim the new dependent’s cash is by filing a tax return. This point is especially important for families who do not normally file a tax return.
How do you know if you qualify for the extra stimulus check?
According to the IRS, single taxpayers with incomes of up to $ 75,000 a year and married taxpayers with incomes of up to $ 150,000 a year qualify for the additional stimulus check of $ 1,400. After those income thresholds, payments are progressively reduced.
The agency has highlighted that there is no limitation on the number of dependents that an eligible taxpayer can claim, that is, if a family had twins in 2021, they will receive an additional stimulus check of $ 2,800 at the time of filing their 2021 tax return. .
IRS launches new tool to receive $ 300 monthly check faster
The Internal Revenue Service (IRS) has launched a new tool that will allow some eligible families to receive their monthly child tax credit payments of up to $ 300 much faster, starting with the next payment in September.
In a statement issued this Friday, August 20, the IRS indicated that the new feature “allows any family receiving child tax credit payments to quickly and easily update their postal address through the Child Tax Credit Update Portal, which it’s exclusively on IRS.gov. ”
Tool enables faster child tax credit payments
The new feature aims to avoid postal delivery delays or even prevent a paper check from being returned due to failure to deliver. “Any family can easily receive their September check and all future checks mailed to their new address by using the portal to make an address change request,” the IRS said.
For the change to take effect with the September child tax credit payment, individuals must complete the application by midnight ET on Monday, August 30. “Families can still make changes after that date, but their request will not be effective until the next scheduled monthly payment,” the agency said.
Any changes made to a person’s mailing address using the IRS Child Tax Credit Update Portal will be the same for all subsequent communications and money transfers from the tax agency, The Sun reported.
The change of address feature can also be useful for taxpayers receiving direct deposit payments, as the IRS plans to mail a year-end statement (Letter 6419) to each taxpayer who has received advance payments from the Credit. child tax for 2021 and having a current address on file with the IRS will ensure prompt delivery of this statement.
Change the way you receive money
The address change function joins a growing suite of services available through the Child Tax Credit Update Portal. The new tool allows families to verify their eligibility for payments either to switch from receiving a paper check to direct deposit, to change the account where their payment is deposited directly, or even to stop monthly payments for the remainder of 2021.
Any of these changes made before midnight ET on August 30 will apply to the September 15 payment and all subsequent monthly payments scheduled for October 15, November 15 and December 15. To access the new IRS tool click HERE.
IRS confirms ‘essential’ requirement to get remainder of check for children
Letter of the Child Tax Credit will be the essential requirement to obtain the rest of the check for children. The US Internal Revenue Service announced the letter that will be necessary to claim the rest of the Tax Credit in 2021.
The IRS announced through a statement that it will provide the updated postal address to send all correspondence to taxpayers, among the documents that will be sent is a letter called 6419, which will be of utmost importance for families.