A Glitch Stopped the First Child Tax Credit Payment From Being Issued to Some Families

[ad_1]

The initial rollout of the monthly advance Child Tax Credit payments has been surprisingly smooth for most households. These payments, which were part of President Joe Biden’s American Rescue Plan signed into law earlier this year, began to hit mailboxes and bank accounts in mid-July, and tens of millions of households have already benefited from the money.

But, while millions of households have seen an extra boost in their budgets thanks to these checks, which are worth $250 to $300 per child dependent, not everyone has been so lucky. Some parents and families who should have otherwise qualified have not received their July checks yet — and it appears to be due to an IRS glitch.

If your July Child Tax Credit is still missing, it could be due to this mistake, which affected only certain households. Here’s what you should know about the issue.

One email a day could help you save thousands

Tips and tricks from the experts delivered straight to your inbox that could help you save thousands of dollars. Sign up now for free access to our Personal Finance Boot Camp.

By submitting your email address, you consent to us sending you money tips along with products and services that we think might interest you. You can unsubscribe at any time.
Please read our Privacy Statement and Terms & Conditions.

READ:  First Job Out of College? 3 Things to Do With Your First Paycheck

The IRS glitch that led to missed payments for some families

The IRS has already rolled out about 35 million Child Tax Credit payments for July, and more will be on the way on Aug. 13. But, while tens of millions of families have already received their checks, many immigrant families are still waiting for the money.

In particular, many “mixed-status” families, with one parent who is a U.S. citizen and the other parent who is an immigrant, found themselves on the wrong side of an IRS glitch when the July Child Tax Credit payments were rolled out, according to a recent report from CBS MoneyWatch.

These households qualified under the requirements that were set for the advance Child Tax Credit payments under the American Rescue Plan. The parents filed their taxes with either a Social Security number or an Individual Taxpayer Identification Number, or ITIN, and also met both the income and age restrictions set by lawmakers.

But, despite meeting the eligibility requirements, these households were still left out of the payment rollout by the IRS, per the report. The payment glitch apparently stems from the use of ITIN numbers on the tax information.

The IRS told MoneyWatch that the missed payments for July’s advanced Child Tax Credit payments were a mistake, but that it has “worked expeditiously to correct this issue.”

Per the IRS, the parties affected by the glitch will receive July’s missed payments in August, when the next payment rolls out.

But, while the payment setbacks may be temporary for these households, this issue has caused yet another hit to immigrant-led or mixed-family households, many of which were denied access to the last three stimulus checks due to the parents’ immigrant statuses.

READ:  7 Things to Know Before You Buy Terra (LUNA)

Millions of other households are at risk of missing out on the monthly Child Tax Credit payments

This isn’t the only hurdle that mixed-family households could face when it comes to taking advantage of the Child Tax Credit payments. According to a recent study, about 4 million or more children and families are at risk of missing out on the monthly Child Tax Credit payments from the IRS.

Per the study, lower-income households, and households with immigrant parents and children with Social Security numbers, are primarily at risk. Many parents in low-income households are non-filers, as are many immigrant parents, which means that they aren’t required to file their tax returns each year.

The IRS determines who qualifies based on the information included on households’ 2019 or 2020 tax returns. Once the IRS determines a household is eligible for the payments, the money is then issued automatically.

But, the process isn’t nearly as simple for non-filers, who can face issues or delays when it comes to the monthly Child Tax Credit payments. Without these households’ information on file via their tax returns, the IRS cannot determine they are eligible, and their household is at risk of missing out.

That is especially troubling, considering that low-income and immigrant-led households were also more likely to have missed out on the last three stimulus payments as well.

What to do if your Child Tax Credit payment is missing

If you are a member of a mixed-family household and have not received your July Child Tax Credit payment, the IRS says that your July payment will be issued in August. The August Child Tax Credit payments are slated to be issued on Aug. 13, so you won’t have to wait long for your payment to hit your bank account or mailbox.

READ:  Unemployment Claims Are Falling Faster Than Experts Predicted

If you are a parent or guardian who typically has non-filer status, you can submit your information to the IRS via the IRS Child Tax Credit Non-filer Sign-up Tool. Make sure to have the following info on hand before you log in:

  • Name
  • Mailing address
  • Birth date
  • Social Security number for you and your dependents (or your other taxpayer ID)
  • Bank account and routing info

If you need to update the information that’s on file with the IRS due to a loss of income recently or a new dependent, you can also do that via the non-filer portal. Updating this information could make you eligible for the advanced payments, or make you eligible for a larger monthly payment if you qualify.

If you need to check the status of your payment, you can use the Child Tax Credit Update Portal to do so. If you’ve created an IRS username or ID.me account in the past, make sure to have that information on hand. If you don’t have an account or username for this portal, you can create one on the login page.

Or, if you want to opt out of the monthly Child Tax Credit payments, you can use the same IRS update portal to do so.

[ad_2]
View more information: https://www.fool.com/the-ascent/personal-finance/articles/stimulus-update-a-glitch-stopped-the-first-child-tax-credit-payment-from-being-issued-to-some-families/

Xem thêm bài viết thuộc chuyên mục: the ascent

Related Articles

Leave a Reply

Back to top button