Nearly 35 million families in the U.S. have been receiving monthly installments of their 2021 child tax credit thanks to the American Rescue Plan. Payments, which are being made in the form of paper checks and direct deposits, range from $250 per child for those between the ages of 6 and 17 years old, and $300 for children under the age of 6.
The IRS has been issuing payments to eligible households since July 2021. The IRS used information from taxpayers’ 2019 or 2020 tax returns, whichever was most recently filed, to determine their monthly amounts. Given the positive impact these advanced payments have made on families all across America, concerns surrounding the child tax credit end date continue to arise. When will child tax credit payments end?
The advanced Child tax credit payments are scheduled to end on December 15, 2021.
The final payment of the 2021 child tax credit is scheduled to be deposited into bank accounts on December 15, 2021. Those who have been receiving their checks via mail can expect to receive them sometime after Dec. 15 but before the end of the month.
Between USPS implementing new service standards for First-Class Mail and Periodicals and people rushing to get their Christmas gifts sent out, mail delivery services are likely to incur delays. Although Dec. 15 is presumed to be the last day families will receive an advanced payment of the child tax credit, it isn’t exactly the final payment.
The American Rescue Plan allowed for families to receive half of their 2021 child tax credit in monthly installments, which means that the other half still needs to be issued. If you’re an early tax filer, you could be collecting the second half of your child tax credit sooner than others.
The final payment of the 2021 child tax credit will be issued when you file your 2021 income tax return. If your child is under the age of 6, you will receive the remainder of your child tax credit ($1,800) when you file your taxes in 2022. Those with children between the ages of 6 and 17 years old will receive $1,500.
Child tax credits aren't exempt from garnishment and will be used to satisfy any owed taxes to the IRS.
Biden’s Build Back Better Plan would extend the child tax credit.
Biden’s Build Back Better Plan would allow for the extension of child tax credit payments to be made through 2022. Although the bill received approval from the House, the Senate has yet to act, which could mean one of two things:
- You will no longer receive advance payments of the child tax credit come January 2022.
- If Biden’s Build Back Better Plan passes through the Senate but with little time left in the year, you could experience a lapse in payments.
While people like Senator Michael Bennet support extending the child tax credit into 2022, which would mean eligible families could continue collecting a check each month, others aren’t eager to act. Business Insider reported that Senator Joe Manchin (D-WV) appears to be resisting the efforts made by his fellow Democrats in getting the $2 trillion spending package passed by Christmas.
Unfortunately, “all 50 Senate Democrats must join together and approve the legislation to clear the upper chamber over unanimous GOP opposition,” reports Business Insider.
What are most families spending their child tax credit on?
The advanced payments of the 2021 child tax credit have helped hundreds of families overcome financial struggles brought on by the COVID-19 pandemic. While some families have used the money to keep current with their monthly financial obligations, including paying rent, others have spent their child tax credit on daycare.
The U.S. Census Bureau learned from its Household Pulse Survey that 3 in 10 families who received advance child tax credit payments spent the money on school expenses for their children. Others used their initial payments to pay off debt.