Tax Breaks

Child Tax Credit Payment Schedule for 2021

The IRS sent six monthly child tax credit payments in 2021. Will they send any more in 2022?

Monthly child tax credit payments were a godsend for many parents who struggled financially in 2021. Families that received their initial payment in July got up to $300-per-child each month (monthly payments could have been higher for parents who started receiving payments later). That kind of extra cash meant the difference between poverty and financial stability for some American families.

The IRS sent the sixth and final round of child tax credit payments to approximately 36 million families on December 15. Dates for earlier payments are shown in the schedule below. As it stands right now, the payments won't continue into 2022. However, President Biden and many members of Congress want to extend them beyond this year. So, there's a chance the IRS will still be sending monthly payments next year, too.

Schedule of 2021 Monthly Child Tax Credit Payments

PAYMENT

DATE

1st Payment

July 15, 2021

2nd Payment

August 13, 2021

3rd Payment

September 15, 2021

4th Payment

October 15, 2021

5th Payment

November 15, 2021

6th Payment

December 15, 2021

How Much Were the Child Tax Credit Payments Each Month?

The monthly payments were simply an advance of the child tax credit you would otherwise claim on your 2021 tax return, which must be filed by April 18, 2022. In most cases, if you received all six payments this year (i.e., from July to December), the combined total of all your payments equaled 50% of the credit you're expected to qualify for on your 2021 return. You'll claim the other half when your file your tax return next year. (Note that the monthly child tax credit payment amounts didn't include the $500 credit available for older children, elderly parents, and other dependents.)

For 2021 only, the child tax credit amount was increased from $2,000 for each child age 16 or younger to $3,600 per child for kids who are 5 years old or younger and $3,000 per child for kids 6 to 17 years of age. If you received your first payment in July, that means the maximum monthly payment for each child under age 6 was $300 and $250 for each child age 6 to 17. Note that families with higher incomes didn't receive that much or were denied the credit altogether, but most eligible parents will see a considerable bump in their child tax credit for the 2021 tax year. (Use our 2021 Child Tax Credit Calculator to see how much you should have received each month if your first payment arrived in July.)

Families who got their first monthly payment after July still received 50% of their total credit for the year. As a result, the total payment was spread over less than six months, making each monthly payment larger. For example, the maximum monthly payment for a family that received its first payment in November was $900-per-child for kids under age 6 and $750-per-child for kids ages 6 through 17. If you received your first payment in December, you got up to $1,800 for each child age 5 and under, and $1,500 for each kid age 6 to 17.

Are Child Tax Credit Payments Taxable?

If you received monthly child tax credit payments in 2021, the IRS isn't going to tax that money when you file your tax return next year. The payments were simply an advance of the child tax credit that you will claim on your 2021 return – they aren't "taxable income." (Since they're not income, the payments also won't affect your eligibility for SNAP, WIC, or other federal benefits.)

The monthly payments still can affect next year's tax bill or tax refund, though. Since they represent advance payments of the child tax credit, they'll be subtracted from the credit amount you're allowed to claim on your 2021 return. That will make your 2021 child tax credit smaller, which means either your tax bill will be higher or your tax refund will be smaller.

Will I Have to Pay Back Any of My Child Tax Credit Payments?

Some people will have to pay back all or a portion of the monthly child tax credit payments they received. Generally, the amount of each payment was based on your 2020 or 2019 tax return (whichever one was filed most recently). However, the total amount of your child tax credit will be based on information found on your 2021 return. As a result, if your circumstances changed in 2021, you may have gotten more this year in monthly payments than the credit you're entitled to claim on your 2021 return. This could happen, for example, if you earned more money in 2021 or you no longer can claim a child as a dependent this year (e.g., because of alternating custody under a divorce decree). Depending on your income, you may be required to pay back the overpayment, or at least some of it. For more on the payback requirements, see Warning: You May Have to Pay Back Your Monthly Child Tax Credit Payments.

Will There Be Child Tax Credit Payments in 2022?

In addition to increasing the credit amount and authoring monthly advance payments, Congress made other changes to the 2021 child tax credit, too. For example, the age for an eligible child was raised to 17, the credit is fully refundable, and the $2,500 earnings floor was removed. An additional layer of phase-outs was also introduced to prevent wealthier families from claiming a larger credit.

Right now, these enhancements only apply to the 2021 tax year. But, as mentioned earlier, President Biden and other lawmakers are trying to extend most of them beyond this year. Whether that happens remains to be seen, but if the Build Back Better Act is passed, the credit enhancements will apply in 2022 as well (with some changes). That would also mean monthly child tax credit payments would continue next year.

We'll continue to cover any further child tax credit developments, but in the meantime you can get up-to-speed on all the changes for this year's credit at Child Tax Credit 2021: How Much Will I Get? When Will Monthly Payments Arrive? And Other FAQs.

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