IRS offers tool to register for monthly child tax credit

The Internal Revenue Service and the Treasury Department introduced an online tool Monday that enables families to register for monthly payments of the expanded Child Tax Credit.

The tool is aimed at families who don’t normally file a tax return so they can register for the expanded Child Tax Credit offered under the American Rescue Plan Act that Congress passed in March, which provides families with up to $300 per month through the end of the year, starting in July. For tax year 2021, the Child Tax Credit increased from $2,000 per qualifying child to $3,600 for children ages five and under at the end of 2021; and $3,000 for children ages six through 17 at the end of 2021. Families will be automatically enrolled in the program if they regularly file tax returns, but for those who don’t the IRS and the Treasury are offering a Non-Filers tool at this page on IRS.gov.

The tool is part of a larger effort at the Treasury and the IRS to help more families obtain advance payments of the Child Tax Credit. The Biden administration has proposed to extend the program beyond the end of this year as part of its American Families Plan in hopes of cutting in half the rate of childhood poverty among American families.

“At Treasury, our goal is to make sure that every American can get the relief funding they need as simply as possible,” said Treasury Secretary Janet Yellen in a statement. “We know working families can’t put off paying for doctor’s visits or grocery bills, and this new tool will help more people get their tax credit every month, starting in July.”

Andrew Harrer/Bloomberg

The new Non-filer Sign-up Tool is for people who did not file an income tax return for 2019 or 2020 and who didn’t use the IRS Non-filers tool last year to register for Economic Impact Payments. The tool allows parents to provide the necessary information about themselves and their qualifying children who are ages 17 and under. Users of the tool can also opt to enter direct deposit bank information so the IRS can deposit the payments directly into their checking or savings account.

Eligible individuals who filed a 2019 or 2020 tax return or used the IRS Non-filers tool last year to register for Economic Impact Payments don’t need to take any action to receive their advance Child Tax Credit payments starting in July. The tool is an update of last year’s IRS Non-filers tool, which was also designed to help eligible individuals who don’t normally file income tax returns register for the $1,400 third round of Economic Impact Payments (also known as stimulus checks) and claim the Recovery Rebate Credit for any amount of the first two rounds of Economic Impact Payments they might have missed.

“We have been working hard to begin delivering the monthly Advance Child Tax Credit to millions of families with children in July,” said IRS Commissioner Chuck Rettig in a statement. “This new tool will help more people easily gain access to this important credit as well as help people who don’t normally file a tax return obtain an Economic Impact Payment. We encourage people to review the details about this important new effort.”

Some economists estimate the American Rescue Plan could potentially lift more than 5 million children out of poverty this year. The advance Child Tax Credit payments will generally be made on the 15th of each month to give families greater financial certainty to plan their budgets. Eligible families will receive a payment of up to $300 per month for each child under age 6, and up to $250 per month for each child ages 6 through 17. The first monthly payment of the expanded and newly-advanceable Child Tax Credit will be made on July 15. Most families will start getting monthly payments automatically next month without any further action required. For families who aren’t required to file an income tax return but are still eligible for advance Child Tax Credit payments, the IRS worked with Intuit and the Free File Alliance to launch this new online tool.

In conjunction with the rollout of the online tool, the Treasury Department’s Office of Tax Analysis analyzed IRS data to identify where children who may be eligible to be claimed for the expanded and newly-advanceable Child Tax Credit but who had not been claimed on a recent tax return are located. The data can help organizations focus their outreach efforts to sign up non-filers for monthly Child Tax Credit payments. This ZIP Code-level analysis is available here. The Office of Tax Analysis did much of the work last year when it was able to identify and send letters to nearly 9 million people who hadn’t filed a tax return recently but who may have been eligible for an Economic Impact Payment.

In the weeks ahead, the IRS plans to add other new tools for the Child Tax Credit, including an interactive Child Tax Credit eligibility assistant to help families determine whether they qualify for advance Child Tax Credit payments. Another tool, the Child Tax Credit Update Portal, will initially allow anybody who has been determined to be eligible for advance Child Tax Credit payments to see they are eligible and unenroll, or opt out, of the advance payment program if they like. The tool will later permit people to check on the status of their monthly payments and update their information. A version in Spanish will be rolled out later this year.

For more information on accessing the Child Tax Credit payments, click here. Answers to Frequently Asked Questions are here.