Why Many Families Who Needed the Child Tax Credit Most Didn’t Get It

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The Advance Child Tax Credit of 2021 is a transformative tax credit available to over 90% of American families with children. The advance portion is a monthly payment of up to $300 that started distribution in July and will last through December. These advance payments alone are thought to decrease the poverty rate among children, according to research by the Urban Institute.

Find: Is There Still Time To Get The Child Tax Credit?
See: Direct Deposit Deadline for August’s Child Tax Credit Payment

Perhaps the most important aspect of this year’s CTC is that you do not need to file taxes in order to receive it. It is fully refundable, which means even if you make no income or do not normally file a tax return, you can receive the money.

If you did file taxes, then the IRS will automatically issue you the benefit. If you are a non-filer, the IRS set up an online portal for low-income families to register themselves to receive the money.

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Unfortunately, however, the IRS’s very tool designed to help low-income families has created a barrier to entry for the population it was intended to help.

Related: How To Use The Child Tax Credit Direct Deposit Portal

Available evidence suggests that the online CTC tool will struggle to reach an even minimal level of efficacy, according to Fatherly.com. The portal was built by Free File Alliance, which is a consortium of tax prep firms they add. Instead of being built in-house by the IRS and implemented directly on the website, the IRS opted to have a third-party create the portal which adds another step and certainly does not simplify the process.

One of the biggest obstacles is that there is no mobile version to the portal. Smartphones have long been known to be the cheaper and more accessible way to access the internet, and quite frankly, it is a gross oversight by the IRS that the non-filer tool is only available through a website. This means a family would have to have a personal computer or go out of their way to access a public computer just to get on the site and register. Considering how much more difficult it is for low-income families to do both, the IRS certainly could have done better to accommodate.

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More: How Can I Check the Status of My Child Tax Credit?

The platform is also only available in English, leaving non-English speaking families entirely in the dark as to how to access the benefit. The IRS provides some tax information on its IRS.gov website in up to seven languages, including English, Spanish, Chinese, Korean, Russian, Vietnamese and Haitian-Creole. For the fully refundable child tax credit, though, it is only available in English.

This adds another barrier to entry, as families who do not speak English will not be able to register without additional assistance.

The child tax credit has already reached millions of families, but it will be difficult to specify how many of the most needy families will be reached by systems put in place that do not benefit them at all.

Know: Check Your Bank Account: Scammers Are Trying To Steal Your Child Tax Credit
Read: IRS Updates Child Tax Credit Direct Deposit Portal

Fatherly also points out that the White House acknowledged that they had not even seen the system until last month, putting a spotlight on the bureaucratic oversights that have resulted in missing the mark for those most in need of help.

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Last updated: July 22, 2021

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About the Author

Georgina Tzanetos is a former financial advisor who studied post-industrial capitalist structures at New York University. She has eight years of experience with concentrations in asset management, portfolio management, private client banking, and investment research. Georgina has written for Investopedia and WallStreetMojo. 
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