How Your Child Tax Credit Benefit Could Be Affected the Earlier You File

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Families that received enhanced Child Tax Credit payments in 2021 will be eligible to claim even more money this year — in the form of tax refunds — during the current filing season. But you might want to file early to ensure the tax refund doesn’t get delayed.

See: What Is the Vermont Child Tax Credit? How $1,200 Payment Compares to Federal Benefits
Child Tax Credit: How To Claim the Full Amount On Your 2021 Taxes

As previously reported by GOBankingRates, the maximum enhanced CTC benefit for 2021 was $3,600 per eligible child under the age of six, with half of the total CTC benefit paid in monthly advance payments between July and December. The other half can be claimed on this year’s tax return, which will let some families receive up to an additional $1,800 per eligible child in refunds.

Parents who received monthly checks should have gotten letter 6149 from the IRS, Business Insider reported. The letter tells you how much money you’ve already received from your CTC, which you must then reconcile on your taxes.

Related: Child Tax Credit Update: Yellen Urges Americans to File Taxes to Get Unclaimed Money

Meanwhile, changes to the Earned Income Tax Credit rules will make millions of taxpayers newly eligible for the EITC this year, Business Insider noted. That’s because the IRS expanded eligibility for the EITC to include young adults with no kids.

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Which brings us to why it’s important to file early if you want your CTC refund sooner rather than later. By law, the IRS can’t issue EITC refunds before the middle of February. When the agency does start issuing those refunds, CTC refunds could be delayed, as well. The earliest the IRS expects EITC and CTC refunds to arrive is March 1 — and that’s only for filers who choose direct deposits and have no other issues with their returns.

Explore: 16 Tax Tips for Single-Income Families
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If you wait much longer to file your returns, you can expect your CTC refunds to be delayed while the IRS works it way through a huge backlog of unprocessed returns from previous years.

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About the Author

Vance Cariaga is a London-based writer, editor and journalist who previously held staff positions at Investor’s Business Daily, The Charlotte Business Journal and The Charlotte Observer. His work also appeared in Charlotte Magazine, Street & Smith’s Sports Business Journal and Business North Carolina magazine. He holds a B.A. in English from Appalachian State University and studied journalism at the University of South Carolina. His reporting earned awards from the North Carolina Press Association, the Green Eyeshade Awards and AlterNet. In addition to journalism, he has worked in banking, accounting and restaurant management. A native of North Carolina who also writes fiction, Vance’s short story, “Saint Christopher,” placed second in the 2019 Writer’s Digest Short Short Story Competition. Two of his short stories appear in With One Eye on the Cows, an anthology published by Ad Hoc Fiction in 2019. His debut novel, Voodoo Hideaway, was published in 2021 by Atmosphere Press.
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