Millions of parents in the U.S. will be getting their second direct payment from the federal Child Tax Credit this month. According to a report by CBS News, most eligible parents don't need to do anything except watch for direct payment in the mail or their bank account sometime this weekend. The payment date is Friday, Aug. 13, and mailed checks may arrive as late as Sunday, Aug. 15.
The expanded Child Tax Credit (CTC) is a part of President Joe Biden's "American Rescue Plan" and is meant to buoy families through the turbulence of the COVID-19 pandemic. It provides a tax credit of $3,600 per child under the age of 6 and $3,000 for each child between the ages of 6 and 17, with half of that money distributed in monthly checks between July and December of 2021. Federal officials say that the distribution of these funds will go more smoothly in August than it did in July.
Officials also published data showing that the CTC is already positively impacting families' economic standing. The U.S. Census Bureau conducted a survey showing that 57 percent of recipients used the money for school supplies and expenses, while 47 percent used it for food. Analysis from the agency read: "A drop in the number of households with children that reported food insufficiency and trouble paying household expenses might be linked to the Child Tax Credit checks issued last month."
As with each stimulus check released since the pandemic began, there have been some issues with eligibility and other distribution of the CTC. There are reportedly still some amended tax returns being processed by the IRS, which will make those taxpayers eligible for the CTC. When that happens, those payments will be included in their 2022 tax refunds.
Families who had children in 2021 will also get their payments down the line when their tax documents reflect their new offspring. There are also issues with "mixed-status" families when it comes to citizenship. According to the IRS, if the children have Social Security numbers, the families should be eligible.
Finally, families with the flexibility to do so may want to consider opting out of the monthly payments in favor of one large payout next year. Doing so on the IRS website here will guarantee them the full amount with their 2022 tax refunds. While it is too late to opt out of the July or August monthly payments, you can opt out of the September payment any time before Aug. 30.