Filing Your 2021 Taxes: What to Know About the Child Tax Credit

Lots of things have changed for American families in the past few years, including changes to the Child Tax Credit. If you file your own taxes, this may bring new questions, like how to claim these monthly payments. Here are some things to keep in mind when filing your 2021 taxes:

1. Qualifications

In order to qualify for the Child Tax Credit, you should:

  • be the parent or legal guardian of a child under the age of 18 who lives with you more than half the time and

  • is claimed as your dependent and

  • have a gross income less than $400,000 if married and filing a joint return, or $200,000 for all other filing statuses.

2.Receiving Missed Payments

There are multiple reasons you may not have received a payment even though you are eligible, but the most likely reason is that your 2020 taxes were filed after the deadline. You can still receive your payment in a lump sum by claiming the Child Tax Credit on your 2021 federal income tax return.

3. Things That Will Offset Your Child Tax Credit

If you owe taxes from previous years, have past-due child support, or are subject to garnishment by local or state government, your Child Tax Credit may be affected. Payments made to you as a Child Tax Credit may be reduced or offset to account for money owed.

4. Immigration and Child Tax Credits

As long as your child has a social security number and you have either a social security number or an IRS Individual Taxpayer Identification Number, you are eligible to receive the payments. These payments will not affect your ability to get a green card or you or your child’s status as a DACA recipient.

5. Payments Received

In January, the IRS sent out Letter 6419 in the mail to all recipients of the CTC. This lists how much you were paid through the credit over the year. Keep that close by when you’re filing to reference how much you received during 2021.

6. Other Helpful Tools

In addition to Letter 6419, you may find it helpful to keep other forms in a place you can easily reference. Form 2555 will have your Adjusted Gross Income for the year. For information on how to claim a dependent, see IRS Publication 501. To check if your dependent qualifies, use this helpful IRS tool. You can use the CTC Portal to view your eligibility, bank accounts and address on file, processed payments, as well as make necessary updates.

For more answers to commonly asked questions, head over to the IRS Child Tax Credit FAQ.

Pioneer and its affiliates do not provide tax, legal or accounting advice. This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for, tax, legal or accounting advice. You should consult your own tax, legal and accounting advisors before engaging in any transaction.

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