First monthly child tax credits go out Thursday

Eligible families to receive up to $300 per child this month

SAN ANTONIO – Most families with young children will see a bump in their bank accounts this week.

On Thursday, the IRS will begin depositing and sending the first monthly child tax credit payments to eligible households.

Amy Novel, mother of a toddler and a preschooler, welcomes the $600 that should come her way.

“It’s very helpful,” she said. “I think we’ll save that for school for my kids. I’m very happy about it.”

The money is part of the American Rescue Plan and Covid Relief bill signed in March. It includes expanded child tax credits aimed at helping families recover after a challenging year.

Child tax credits aren’t new. Most families were already getting $2,000 per child when they filed their federal taxes. For 2021 taxes, the credit is bigger.

“The credit is now $3,600 for a child under six and $3,000 for children between six and 17,” said Dionelle Rucker, financial and tax adviser with Torres Financial Services.

Not only is the credit larger, but eligible families can get up to half of it early in monthly payments for the rest of this year. The other half would be credited when 2021 taxes are filed.

The monthly payments will be $300 per month for six months for each child younger than six and $250 for children six through 17.

To claim it, most people don’t have to do a thing.

“Absolutely not,” Rucker said. “You are automatically enrolled if you claimed the child tax credit on your taxes in 2020 or 2019.”

If you have a new child or didn’t file a tax return, you can still claim the credit through the IRS website.

While most families with children do qualify for some payment, the amounts phase out as income increases.

Individuals with incomes less than $75,000 are eligible for the full credit as are married couples with incomes less than $150,000. The credits phase out completely for individuals who earn more than $95,000 or couples who earn more than $170,000.

While many people can use the extra cash now, not everyone may want to claim the advance credit this year for various financial reasons.

Taxpayers can opt-out through the IRS website. It’s too late to opt-out of the July payment, but there is time to opt-out of remaining monthly payments.

More on KSAT:

Child tax credit payments start July 15 but you can opt-out


About the Authors:

As a consumer reporter, Marilyn is all about helping people stay safe and save a buck. Since coming to KSAT in 1985, she’s covered everything from crime to politics, winning awards for her coverage of the Mexican Mafia, Oklahoma tornadoes, children’s transplants, an investigation into voting irregularities and even a hit-and-run Santa Claus.