09 Jul ADVANCE CHILD TAX CREDIT COMING THIS MONTH – Should you Opt Out? Possibly
DON’T BE SURPRISED!
THE ADVANCE CHILD TAX CREDIT WILL CAUSE MANY TAX SURPRISES NEXT YEAR AND 35 MILLION TAX REFUNDS HAVE NOT BEEN PAID BY THE IRS YET
Over 36 million families will have some extra money in their bank accounts starting this month, as the first advance child tax credit (CTC) is scheduled to be paid on July 15th.
The enhanced payments, established by the American Rescue Plan Act (ARPA) earlier this year — for eligible families.
Eligible families will receive half of their credit in the form of monthly payments of up to $250 per school-age child and up to $300 per child under 6 from July through December 2021. The other half will be paid in a lump sum when parents file their 2021 taxes next tax season.
Many parents have been anticipating the checks and electronic deposits. Many have received IRS letters announcing it. However, it may be best for you to ‘opt-out’ of these payments and wait for the credit on your 2021 tax returns.
These advance child tax credit payments are a pre-paid tax credit you usually receive when your individual income taxes are filed.
The advance payments could actually cause you to owe more when you file your 2021 taxes, making this a surprise when you file next year. We are trying to prevent this surprise for you with this information.
We will be calculating all of this for you when we prepare your 2021 individual income tax return next year and we will adjust this credit accordingly.
GREAT ARTICLES AND RESOURCES ON THIS:
Here’s what to know about the payments and the credit, and to find out if you are eligible for it:
READ A DETAILED ARTICLE ABOUT IT FROM CNBC BY CLICKING HERE
June 28th was the date to opt-out for the July 15 first payment, but all other payments may be stopped, and here is how. CLICK HERE FOR THAT INFORMATION
TAX REFUNDS ARE STILL DELAYED THIS YEAR – IT’S NOT JUST YOU. IT’S 35 MILLION TAXPAYERS CURRENTLY! DO YOU WANT TO KNOW WHERE YOUR REFUND IS? WELL, DON’T BOTHER CALLING THE IRS!
We have been receiving many calls and emails from clients about their individual income tax refunds not being received yet. There has been a growing backlog of unprocessed (yet filed) tax returns by the IRS that now stands at 35 million! This has been creating ongoing refund delays for millions of US taxpayers by the IRS. The National Taxpayer Advocate has published this in this recent report.
This represents an increase in the IRS’ backlog of unprocessed returns from May 2021, when it was holding 31 million returns. So, the problem is getting worse!
Unfortunately, the IRS is overwhelmed with inquiries on this matter as well, and communication to them has been nearly non-existent as calls often go unanswered. here is an article that provides further details on why you/we can’t get through to the IRS right now when you call them. The IRS has answered only 2% of the 75 million phone calls that they have received recently – mostly calls about taxpayer’s tax refunds!
READ MORE ABOUT THIS HERE FROM AN ARTICLE AT CBS NEWS