There may not be another direct stimulus payment on the horizon, but as of last week, more federal money has been landing in bank accounts and mailboxes across the nation. In mid-July, the IRS began sending out the first round of advanced Child Tax Credit payments, which are worth up to $300 per child to families who qualify.
Thus far, about 35 million payments worth $15 billion have been sent out to households across the country, and more will be on the way soon. The IRS will continue to send out the money from the enhanced Child Tax Credit through December 2021 — adding more to the budget for millions of households.
But, while this money may help to buoy households who are still struggling to recover from the financial crisis caused by the pandemic, not every household needs — or wants — the extra cash on a monthly basis. If you qualify for the monthly advance payments but don’t want to be on the receiving end of the extra money each month, you have one week left to stop them. Here’s what you should know.
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Steps for stopping the Child Tax Credit payments
The next round of payments for the advanced Child Tax Credit won’t happen until Aug. 13, but if you want to avoid an unwanted payment next month, you need to take action now to stop them. The deadline for unenrolling from the August payments is quickly approaching.
You have until 11:59 p.m. on Monday, Aug. 2 to unenroll from the advanced Child Tax Credit payments. Anyone who misses that deadline will receive the August payments — and all of the payments thereafter.
There are many reasons you may want to unenroll from these payments, but what’s important to keep in mind is that the deadline is firm. You need to unenroll before the stroke of midnight on Aug. 2 to avoid an automatic payment making its way to your mailbox or your bank account next month.
You should note, though, that there is no way to re-enroll after you unenroll from the monthly payments. If you want to pass on the August payment but later decide that you need the September payment, you won’t be able to get it. There is currently no way to enroll back into the monthly advance payments. The IRS does plan to add an option for re-enrollment to the system in September, however.
How to unenroll from the Child Tax Credit payments
If you want to unenroll from the monthly payments, you’ll need to visit the Child Tax Credit Update Portal and sign in with your IRS username or ID.me account. If you don’t have an account or username, you can create one on the login page.
This tool was recently launched by the IRS, and it offers a range of useful information on the enhanced Child Tax Credit payments, including whether or not your payment has been processed. You can also use this tool to find out whether or not you are eligible for the monthly payments, or to opt out of the monthly payments entirely.
After you sign in, you should be able to determine if you’re eligible to receive the payments and see when the payments are scheduled to be made to you. You’ll also see an option to opt out of the payments — provided you’re eligible to receive them.
From there, you can choose to unenroll — i.e. opt out — from the payments. That said, if you’re married, you may need to have your spouse unenroll, too. If you filed your last tax return jointly with your spouse, unenrolling from the payments will only affect your payments — not your spouse’s. So, you’ll both need to opt out separately to stop the payments from coming.
If you opt out of the monthly payments, you will still be eligible to claim the enhanced Child Tax Credit on your 2021 tax return.
Payment missing? Here’s how to check the status.
On the other hand, you may be looking for your missing July Child Tax Credit advance payment. If your payment hasn’t arrived via mail or direct deposit, you can use the same Child Tax Credit Update Portal to check whether you qualify, where your payment is, and when it’s slated to be sent out.
If you are typically a non-filer, you may need to take further action via the Child Tax Credit Non-filer Sign-up Tool to register for any upcoming payments you qualify for. The IRS is using your most recent tax return to determine whether or not you’re eligible for the advanced payments, and it can’t determine whether you’re eligible if your up-to-date information isn’t on file with the IRS.
If you’re going to use the non-filer portal to update your information, make sure you have the following information on hand before you login:
- Full name
- Current mailing address
- Email address
- Date of birth
- Valid Social Security numbers (or other taxpayer IDs) for you and your dependents
- Bank account number, type and routing number, if you have one
- Identity Protection Personal Identification Number (IP PIN) you received from the IRS earlier this year, if you have one
You can also use this portal to update your information if you’ve had a significant loss of income or added a new dependent to your household after you last filed your taxes. Either situation could make you eligible for the advanced payments, or for a larger monthly payment, so make sure to update your information as soon as possible so you don’t miss the deadline.
View more information: https://www.fool.com/the-ascent/personal-finance/articles/stimulus-update-you-have-1-week-left-to-meet-this-important-child-tax-credit-deadline/