Child Tax Credit Information - Tax Year 2021

President Biden signed the American Rescue Plan into law on March 11, 2021, raising the Child Tax Credit from $2,000 to $3,000 or $3,600 per child for the 2021 tax year. Here are some important things to know:

  • The increase is for 2021 only.
  • 17-year-old children are now included.
  • The credit is $3,000 for children aged 6-17 and $3,600 for children under 6.
  • Advanced payments will begin being sent July 15th, 2021 in monthly installments of either $250 or $300 per child through December.
  • Advanced payments will total half of your eligible Child Tax Credit amount for 2021, with the remaining half being claimed when you file your 2021 return
  • If you filed a 2019 or 2020 tax return, you will automatically receive the Advanced payments, unless you opt out at https://www.irs.gov/credits-deductions/advance-child-tax-credit-payments-in-2021 (link available July 1st
  • The enhanced credit begins to phase out at AGIs of $75,000 on single returns, $112,500 on head-of-household returns and $150,000 on joint returns.
  • The amount you receive in advanced payments will lower the amount you are able to receive on your 2021 return. For example, if you receive $1,500 in advanced payments, you will claim the remaining $1,500 credit on your return. However, if you opt out of the advanced payments, you will claim the full $3,000 on your return.