On July 15, tens of millions of families woke up to find a deposit from the Internal Revenue Service (IRS) in their bank accounts. The payments are the first of six “advance” installments for the expanded child tax credits.
The Daily Citizen previously reported that under the American Rescue Plan, which was passed in March 2021, Congress expanded the child tax credit from $2,000 per child to $3,000 per child age 6 to 17 and $3,600 for those under 6.
Each family will receive half of their child tax credit allotment doled out over the next six months in equal monthly payments unless they opt out.
A family with two children between the ages of 6 and 17 can expect to receive $3,000 of their $6,000 allotment over the next six months, in six separate monthly payments of $500. When families who receive the payments file their 2021 tax returns, they will receive the other half of their credit.
For those families that do choose to receive half of the payment up front, they will receive less on their 2021 tax returns.
Families can request to opt out of the monthly payments through the IRS website.
Of note, when going through the opt out process, individuals are prompted to create an account with the IRS through ID.me, a technology platform that verifies the identity of an individual through a facial scan.
Step one in the verification process includes a scan of an individual’s driver’s license, state ID or other official document. Next, individuals take a picture of their faces, after which ID.me “uses facial recognition to match the user’s selfie to their uploaded government ID.”
An alternative verification process is available.
Also of note, the tax credits are “fully refundable, which means that families who do not pay any taxes will still qualify for the entire amount for each eligible child.”
Regarding the “advance” monthly payments, Focus on the Family President Jim Daly expressed his concerns about the addictive power the monthly distribution of tax credits could have on families.
“There’s no question that extra dollars can keep the wolf from the door – but how do you feel about growing dependent upon the government or growing accustomed to the monthly check from Uncle Sam? And what about families who fail to budget accordingly and pay adequate taxes as they go along?”
“Accountants are warning that many families will be hit with a large tax bill next April,” he added.
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