Arizona families with children will start to see hundreds of dollars in extra monthly payments in their bank accounts or mailboxes starting Thursday.
An expanded federal child tax credit that was part of the American Rescue Plan approved by Congress and signed by President Joe Biden earlier this year is intended to help families deal with the unforeseen financial challenges of the COVID-19 pandemic and combat child poverty.
Nearly 39 million of households will be eligible for the credit, covering about 88% of children in the US.
Here’s what you need to know if you’re an Arizona parent who may qualify for the payments.
What is the child tax credit?
The child tax credit has existed since 1997 and was created to help families offset the cost of raising children, according to The Center on Budget and Policy Priorities.
Earlier this year, as part of the American Rescue Plan, the maximum amount of the credit was increased to $3,600 per child for children under the age of 6, and $3,000 per child for children between the ages of 6 and 17.
While the credit is typically applied to a family’s tax refund, this year, half of the credit will be distributed in six monthly installments through the rest of 2021. Households getting the full benefit will receive $300 per month for children 6 years old and under, and $250 for children between the ages of 6 and 17.
There is no limit as to the number of children that can receive the credit in each family, so a family with six children under the age of 6 could receive $21,600 this year.
How do I qualify?
Parents with children 17 and under who live with them at least six months out of the year are eligible for the tax credit. Both parent and child must be US citizens, and parents must have a Social Security number or Individual Taxpayer Identification Number (ITIN) to qualify.
Children who are not US citizens and don’t have a Social Security number, including adopted children with an Adopted Taxpayer Identification Number or an ITIN, will not qualify for the credit.
The full credit will be available to single parents making up to $112,500 or married couples making a combined $150,000 and filing jointly. Families with higher incomes could see smaller portions of the credit, or they may not qualify at all.
If you’re unsure if you qualify, you can check your eligibility online on the IRS website.
Families who already filed their IRS tax returns for 2020 or 2019 will automatically get the child tax credit via direct deposit or in their mailboxes without needing to take any additional action.
Families who have not yet filed taxes or who have not made enough money to file taxes can still qualify for the tax credit by using the IRS Non-Filer Sign-up Tool.
Can I opt out?
Families who want to receive the full $3,000 or $3,600 per child tax credit as a lump sum on next year’s tax returns can choose to opt out.
The last day to opt out of the first child tax credit payment has already passed, but parents can visit the Child Tax Credit Update Portal to opt out of payments moving forward.
When will I get the payments?
Checks will begin being deposited via direct deposit or sent out in the mail on Thursday, July 15.
After that, payments will be disbursed on Aug. 13, Sept. 15, Oct. 15, Nov. 15, and Dec. 15.
For more information, visit www.ChildTaxCredit.gov.