Non-tax-filing dad and mom will not get baby tax credit score funds until they act by Oct. 15. Here is why

Non-tax-filing parents won't get child tax credit payments unless they act by Oct. 15. Here's why

The third baby tax credit score fee this month reached 35 million households.

Sarah Tew/CNET

After the July baby tax credit score fee was issued this summer season, a report revealed by the Middle on Funds and Coverage Priorities warned that some 4 million youngsters in low-income households may miss out on the improved profit this yr. Why? As a result of the IRS is basing eligibility for this yr’s prepayments on 2020 tax returns. If households did not make sufficient to file a return, or simply have not gotten round to it but, the IRS would not know they had been certified to get the funds, which might be as much as $3,600 complete per baby.

In reality, in earlier years, low-income households or dad and mom with out earnings acquired solely a portion of the credit score, if any in any respect. However the guidelines for the 2021 credit score modified to permit extra households to qualify, even when they don’t have any revenue. The IRS has made it straightforward for non-tax-filing households to register on-line without spending a dime by submitting a simplified return. What’s extra, while you use the Non-filer Signal-up Instrument, the IRS will robotically challenge a fee for each the kid tax credit score and the third stimulus examine, assuming you are eligible. 

How does this have an effect on you? With three month-to-month funds already issued — and three extra to go this yr — the final day to make use of the IRS non-filer device is Oct. 15. And if dad and mom register on-line earlier than Oct. 4, they could even be eligible to get their first fee in October. For extra, here is what to learn about upcoming deadlines and tips on how to use the IRS Replace Portal to handle funds and replace your private data. 

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Child tax credit: Everything we know


How to use the IRS nonfiler tool to sign up for payments 

The IRS launched its online tool back in June to help families that don’t normally file income tax returns to enroll in this year’s child tax credit program. The tool isn’t for families who already filed — or plan to file — their 2019 or 2020 income tax return. The IRS will use those tax returns to determine eligibility and disburse the coming payments to qualifying families. The Center on Budget and Policy Priorities predicts that it will take families 15 to 30 minutes to sign up

The free Non-filer Sign-up tool is designed to allow the poorest families and those experiencing homelessness to register with their name, address and Social Security numbers. Individuals will be able to notify the IRS about any of their qualifying dependents and can provide their bank information for direct deposit of the payments once they start. 

The IRS has guidance on how to fill out the form. The first step is to create an account with an email address. The next few steps require entering your information, including an address or bank account to receive payments. You’ll also need to provide your adjusted gross income, or AGI, and sign the form electronically. Here’s what to do:

1. To get started, create an account if you don’t yet have one. You’ll need a phone number, a password and an email address to confirm your information. Note that it can take up to 48 hours for the IRS to confirm your email address — and another 48 hours after submitting your information for the IRS to accept it.

2. On the next page — “Fill Out Your Tax Forms” — enter your information, including your filing status and details about dependents. Those fields are required, but you can skip the optional fields if they do not apply to you. For example, you can also add information about your “Recovery Rebate Credit” on the form, or your banking information to receive your payments electronically instead of in the mail. Tap Continue to Step 2 when ready.

3. On this page — “E-File Your Tax Forms” — you’ll provide your adjusted gross income, or AGI, and sign the form electronically by creating a new pin. If you did not file taxes last year, enter “0” in the box for AGI and skip the part about last year’s self-selected signature PIN. When you’re done, tap the Continue to E-File button to submit your information. 

The tool has come under fire by some advocacy groups for not being easy to use. The IRS recommends using the portal on a laptop or desktop computer, not on a phone. (The platform on mobile devices is not as easy to read.) Users will also need an email address, a solid internet connection, their filing status and other tax-related information, which isn’t typically available for nonfilers. For now, it’s only accessible in English, though the instructions are available in multiple languages.

Don’t use the IRS nonfiler tool if you already filed a tax return

The IRS says you shouldn’t use the nonfiler online tool if you already filed a 2020 income tax return or if your adjusted gross income, or AGI, exceeded $12,400 ($24,800 for a married couple). It also says you can’t use the tool if your main home is outside the US, if you or your spouse can be claimed as dependents or if you are requesting an advance child tax credit for a child born in 2021. (However, you can use the tool if you need to claim a recovery rebate credit.) 


The next monthly advance check goes out on Oct. 15. 

Sarah Tew/CNET

How to opt out of the rest of the advance monthly payments 

Families may unenroll from the child tax credit to defer the advance monthly checks and instead receive the remainder of the credit during tax time next year. The sooner you unenroll through the Update Portal, the better because it can take up to seven days for your request to process. Sometime this month, you’ll be able to re-enroll if you change your mind.

Here are the remaining deadlines for unenrolling from the advance monthly payment program. 

Child tax credit unenrollment deadlines

Unenrollment date Payment date
Oct. 4 Oct. 15
Nov. 1 Nov. 15
Nov. 29 Dec. 15

What to know about payments and 2022 taxes

The child tax credit payments are advances on next year’s tax refund for eligible parents. You’ll get half of the money over the course of seven payments in 2021 and 2022. If for whatever reason you receive more money than you’re eligible for, you’ll need to pay the IRS the difference based on your tax return when you file in 2022. However, there is a repayment protection program to help low-income families that may not be able to repay the extra money. 

Other reasons to use the IRS child tax credit tools

We expect changes to the IRS website throughout the fall. You can now view your child tax credit payment history and update your direct deposit and mailing address in the Update Portal. Later on, you’ll be able to change other household details like number of dependents and income. 

For more information about child tax credit, here’s what to do if you’re missing a payment

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