Millions of American families are going to get two very significant letters in the mail, at least some of which are no doubt hoping for a new stimulus check. Receipt of the letters is an automatic step in receiving the first of multiple new stimulus checks, but don't be concerned if you overlook or miss them.
They give information about upcoming payments that are scheduled to arrive in mailboxes and bank accounts, but they aren't required, as long as the recipients have done one very crucial thing: filed their 2020 federal tax return. The IRS is pushing everyone to make sure they're up to date on this since it will guarantee that when the new stimulus checks are sent, the tax agency has the most up-to-date information on where to send the payments.
What to do to receive Child Tax Credit?
Those payments are monthly installments of the enhanced federal child tax credit, which President Biden signed into law in March as part of the $1.9 trillion stimulus package. Another incentive to make sure you're up to date on your taxes is that the IRS will have the most up-to-date information on your eligible children for this new stimulus benefit.
Families could expect two letters from the IRS before getting the first child tax credit stimulus payment on July 15, according to a news release sent by the IRS earlier this week. The initial letter will merely inform a family that they are qualified for these payments, which applies to around 36 million households in the United States, accounting for 88 percent of the country's children.
The second letter will be more personal, giving families an estimate of how much money they may receive. Families with children, on the other hand, should be able to anticipate this quite accurately ahead of time.
Families may now get up to $3,600 for each eligible child under the federal child tax credit increase, which will be paid out in monthly payments. That means they'll get a monthly check of up to $300 for each qualified child under the age of six, and up to $250 for each eligible child between the ages of six and seventeen.
"Later this year, individuals and families will also be able to go to IRS.gov and use a Child Tax Credit Update Portal to notify the IRS of changes in their income, filing status, or number of qualifying children; update their direct deposit information; and make changes to ensure they are getting the right amount as soon as possible," the IRS says, as per BGR.
This new payment will be made on a monthly basis. Those who qualify will get payments on the 15th of every month until the end of the year. The total cost of the next cycle of payments is $3,600.
Parents with children under the age of six will receive monthly payments of $300. Families with children aged 6 to 17 will get a monthly payment of $250. Payments are set at $3,600 for children under the age of six and $3,000 for those aged six and beyond.
Individuals earning less than $75,000 and married couples filing jointly earning less than $150,000 will be eligible for the fully enhanced federal child tax credit. At $95,000 and $170,000, respectively, the credit fades off. Per Fox5 Baltimore, many people will be eligible for this tax credit.
How soon will I get my stimulus check?
From Thursday, July 15, the Internal Revenue Service (IRS) will begin depositing or sending stimulus checks, according to National Interest. Subsequent payments will be paid on the 15th of each month, although if the 15th occurs on a weekend or public holiday, they could be somewhat delayed.
This year, six checks will be sent, with the remaining funds to be claimed when Americans submit their tax returns in 2022. Americans who submitted their tax returns by the May 17 deadline will have their payments processed automatically, so they won't have to do anything.