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CORONAVIRUS AND TAXES

Advance Child Tax Credit Payments in 2021

The advance child tax credit payments were early payments from the IRS of 50% of the estimated amount of the Child Tax Credit that you can claim on your 2021 tax return during the 2022 tax filing season.

The payments were sent automatically to eligible individuals. If the IRS has processed your 2020 tax return or 2019 tax return, these monthly payments were made starting in July 2021 through December 2021.

The other half of the credit should be claimed on your 2021 income tax return. If you chose to opt-out of the advance payments, you may claim the full amount if the Child Tax Credit on your 2021 tax return.

Who was eligible for the advance child tax credit payments?

To qualify for advance payments of the Child Tax Credit, you (and your spouse, if you filed 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 your information in 2020 to receive the stimulus payments for Non-Filers or

-
Given the IRS your information in 2021 through the Non-Filer: Submit Your Information tool; and

        -
Lived in a main home in the United States for more than half the          year (the 50 states and the District of Columbia) or filed a joint          return with a spouse who has a main home in the United States          for more than half the year; and

        -
A qualifying child who is under age 18 at the end of 2021         and who has a valid Social Security number; and

        -
Made less than certain income limits.

Are the advance child credit payments taxable?

No. Advance Child Tax Credit payments are not considered income should not be reported as income on your 2021 tax return.

Since the payment is an advance of the Child Tax Credit you will claim on you 2021 tax return, it is based the IRS’s estimate of your 2021 Child Tax Credit.

If the total you receive is greater than the Child Tax Credit amount that you are allowed to claim on your 2021 tax return, you may have to repay the extra money on your 2021 tax return during the 2022 tax filing season.

For more questions on the Advance Child Tax Credit?

Visit the IRS' 2021 Child Tax Credit and Advance Child Tax Credit Payments Frequently Asked Questions.

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