For the last two months, the IRS has been sending out Child Tax Credit checks to millions of American families with children or dependents who qualify. These payments, which are worth a maximum of $250 to $300 per child, will continue to land in mailboxes and bank accounts through the end of the year as part of President Joe Biden’s American Rescue Plan, which was signed into law earlier this year.
The money for the Child Tax Credit is meant to help low- and middle-income families stretch their budgets and recover from the financial challenges that were caused by the pandemic. And, so far, the monthly advance payments appear to be helping. According to a recent study, the first round of Child Tax Credit money made a big dent in the finances of families across the nation, helping to slash hunger rates, lower financial instability, and decrease the anxiety surrounding finances for many families.
That said, not every family has been so lucky. Many households have reported issues with missing or delayed checks over the last couple of months, and the IRS has noted a fair share of issues with the payment system, too. To help curb these types of problems, the IRS just rolled out a new feature in its online portal that makes it easy for users to update their important information. If you’re slated to receive a paper check, you may want to take advantage of this new feature right away. Otherwise, you could be waiting much longer than anticipated for your check to arrive. Here’s what you should know.
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The important deadline that’s looming for paper check recipients
The IRS recently made an update to the Child Tax Credit Update Portal, the online tool that offers users certain types of information about their Child Tax Credit payments. Prior to the update, you could not change the address on file with the IRS via the update portal, but this new feature makes it possible to do so.
The new feature can be used by anyone who receives the Child Tax Credit payments — whether they receive direct deposit or paper check payments — but it is especially useful for those recipients who opt for paper check.
The IRS uses your 2019 or 2020 tax return information to determine whether or not you qualify for the monthly payments, which means that the address they have on file for you could be outdated if you’ve moved within the last year or so. This isn’t generally an issue for people who receive their payments via direct deposit, but it can cause serious issues for those who receive paper checks.
Having the wrong address on file with the IRS can cause a number of problems, including long payment delays due to the mail forwarding process. It could also cause some paper checks to be returned as undeliverable, causing families to miss out on the money they qualify for.
So, if you’ve moved recently and want to avoid issues with mailing delays or returned checks with the next round of checks, you should update your address using the portal’s new feature — and you should do so quickly. In order to receive your September payment at the new address, you’ll need to update your information in the portal by the deadline, which is Aug. 30 at midnight Eastern Time.
But, even if you don’t receive paper checks, you may still want to update any incorrect address the IRS has on file. The IRS will be mailing out a year-end summary, known as Letter 6419, to recipients of the advance payments, and you’ll need the letter to claim the remaining amount of the Child Tax Credit on next year’s tax return.
Other uses for the Child Tax Credit portal
The Child Tax Credit portal isn’t just for address updates, though. In addition to using the portal for address changes, you can also use it to:
- Verify whether or not you’re eligible for the monthly advance Child Tax Credit payments
- Change your payment method from paper check to direct deposit (or vice versa)
- Update the bank account information on file for direct deposit
- Opt out of the upcoming monthly payments
You cannot, however, use it to update non-filer information with the IRS. If you are a non-filer who may qualify for the advance Child Tax Credit payments, you will need to use the IRS non-filer portal to ensure that your information is on file with the IRS.
To use the non-filer tool, you’ll need to give the IRS your name, mailing address, birth date, the Social Security number for you and your dependents (or your other taxpayer ID), as well as your bank account and routing information for payments.
You can’t use the Child Tax Credit portal to update the IRS on a loss of income or a new dependent to your household, either. If you need to correct the dependent or income information the IRS has on file, you’ll do that via the non-filer portal.
View more information: https://www.fool.com/the-ascent/personal-finance/articles/stimulus-update-update-this-info-with-the-irs-or-you-could-miss-an-important-child-tax-credit-deadline/