WAUSAU, Wis. (WAOW) -- Advance child tax credits, which are early payments from the IRS, will go out monthly, beginning on July 15 through December, along with a larger payment at the end of the year.
So how much could you get?
"There's basically thresholds, so depending on the size of your income and the size of your family will determine how much credit you may or may not qualify for," said Doug Gross, Partner at MBE CPAs.
For married couples making $150,000 or less with kids younger than 4 years old, it's $3,600 per qualifying child. And for kids ages 6 through 17, $3,000.
"So if you have the one child that is 4 years old you'd be getting a $3600 child tax credit, you're gonna get $300 payments each month for 6 months so you're going to get half of that up front. If the kids are older than that, you're gonna get the $300 per month," said Curtis Day, CPA at Wausau Tax & Accounting.
This includes children age 17, instead of children younger than age 17 as previous tax credits have required.
The IRS will do these advance payments automatically, but if you'd prefer...
"You can opt-out, and the credit will get calculated when you file your tax return next spring," said Gross.
But you'll need to be careful if you decide to get paid in advance, in case your cash flow changes.
If you will not qualify for the tax credits on your 2021 tax return, you could end up paying those back, unless you qualify for repayment protection.
"The danger of taking the credit ahead of time is if your income were to go up and now you don't qualify, you would have to pay that credit back next spring when you file," said Gross, "There will be a reconciliation that will happen when you file your tax return where you'll need to report what you have received throughout the next 6 months."
It's also important to note that the IRS does not contact people via email, text message, or social media to request personal or financial information.
You can find more information, including a FAQ page, here.
A recent update from the IRS can be found here.