IRS Tax Tip 2021
Taxpayers may be able to claim the child tax credit if they have a qualifying dependent child 17 or younger. The credit is refundable in 2021, so it may give a taxpayer a refund even if they don’t owe any tax.
The taxpayer’s qualifying child must have a Social Security number issued by the Social Security Administration before the due date of their tax return, including extensions.
A dependent who doesn’t have the required SSN may be eligible to be claimed for the credit for other dependents.
Here are some numbers to know before claiming the child tax credit or the credit for other dependents.
Up to $3,000 per qualifying dependent child 6 to 17 on Dec. 31, 2021.
Up to $3,600 per qualifying dependent child 5 or younger on Dec. 31, 2021.
$500: The maximum amount of the credit for other dependents for each qualifying dependent who isn’t eligible to be claimed for the child tax credit. This can include dependents 18 and older, and dependents who don’t have the required SSN.
Important changes to the Child Tax Credit will help many families get advance payments of the Child Tax Credit starting in the summer of 2021.
Half the total credit amount will be paid in advance monthly payments, and you will claim the other half when you file your 2021 income tax return
Note. – The IRS will send you a Letter 6419 that tells you the total amount of advance payments sent to you in 2021. Please keep this letter for your tax records. Also verify the amount of the advance payments with your Bank Account.