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Some reasons why you get the incorrect amount in your Child Tax Credit.
The United States Internal Revenue Service is set to release the second round of advance child tax credit payments later this week amid a controversy where many taxpayers with Individual Taxpayer Identification Numbers (ITIN) have yet to receive their money from the first payment.
In a statement, the IRS said it was working tirelessly to fix the issue and distribute the missing money among those eligible for the payment. The advance tax credit works under the American Rescue Plan Act which was signed into law in March.
Advance Child Tax Credit Payments
Lawmakers expanded the Child Tax Credit and ordered the IRS to distribute monthly advance payments to eligible families starting on July 15. Child tax credit usually goes to taxpayer families with kids when they file their income taxes. Half of the newly enhanced child tax credit will be given out in monthly payments from July until December as an advance credit. The remaining half of the credit will be given after the releasing of payment for the 2021 federal income taxes, 5NBC DFW reported.
For the distribution that will begin this Friday, the IRS is set to give more than 30 million eligible households with the advance child tax credit payments. While the agency typically sends out the payments on the 15th of each month, they will be distributed on August 13 due to the regular date falling on a weekend this time.
The remaining payments for the year will be scheduled to be released on the 15th of each month. Families who are eligible for the payments will receive up to $300 per month for each qualified child under the age of six and $250 per month for each qualified child between six and 17 years old, KTLA5 reported.
The full payment comes out to be $3,600 for every child under six years of age and $3,000 for kids aged between six and 17 years. The maximum credit was set at $2,000 per child per year in previous times.
Increase in Payments for Families
The increase in the payout of the child tax credit and the new advanced payments were a direct result of the $1.9 trillion COVID-19 relief package that United States President Joe Biden signed. Nearly eight million children in California are expected to benefit from the child tax credit expansion.
Individuals who pay their taxes and have a modified adjusted gross income of $75,000 or less for singles, $112,500 or less for heads of households, and $150,000 or less for married couples filing jointly, will be eligible for the child tax credit payments.
About 60 million children can expect to receive payments from the second round of distributions for the child tax credit. Some of the families who have yet to receive their money from the first payment may receive both this month, CBS News reported.
Many of the eligible families will not have to process additional requirements to receive the money if they have already filed their 2019 or 2020 tax returns. Parents can also opt to receive the full payment at the end of the timeline by applying through the IRS website.
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