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Are your children eligible for the 2021 child discount? This is what you need to know


Children who meet the age rules can bring thousands of dollars to qualified families.

Angela Lang/CNET

Find out if your children qualify for the child tax credit payments is now important to know. The first of the monthly checks will arrive on July 15th to families meeting the requirements. Your income and the age of your dependents are used to determine how much money you will receive — you can check this with CNET’s calculator. For example, you can get $3,600 if your child is under 6 — including if you having or adopting a baby this year — and your salary is less than $75,000.

About 39 million households will receive a child tax credit for a certain amount starting this summer, according to the IRS. The advances come in on or around the 15th of each month, depending on weekend and holiday schedules. The IRS opens two online portals before July 1 where you can unsubscribe from monthly payments and update your information.

The IRS will focus more on the payment details of the child tax credit in the coming period. For now, here’s how the The following White House stimulus proposals could make you money and what we know about a potential? fourth stimulus check and student loan forgiveness. Also here is how to claim up to $16,000 in childcare costs. This story was recently updated.

Suitable for people with children aged 17 and under

If you have surviving relatives who are 17 or younger, they can each count towards the new child tax credit. However, the amount they qualify for depends on their age. Children between the ages of 6 and 17 each count for up to $3,000. Kids under 6 can count up to $3,600 each.

The earlier child tax credit provides families with $2,000 per child ages 16 and under, so adding an additional $1,000 to $1,600 per child can help families significantly financially. Plus, the new CTC adds 17-year-olds to the mix.

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Part payments come for those with children ages 18 to 24

If you have 18-year-old dependents, they may each qualify for up to $500 in the amount of child tax credit you receive. If you have a dependent between the ages of 19 and 24 who attends college full-time, they may also qualify for up to $500 each for your total payment, according to the new stimulus bill.

Babies born this year are also eligible for up to $3,600

If you expect your baby to arrive before the end of 2021, the newborn is also eligible for up to $3,600 for the child tax credit. This includes children who are adopted assuming they are US citizens (more on that below). You can use the IRS portal as soon as it becomes available to update your information to add your new family member or you can claim the tax credit when you file your 2021 tax return next year, according to Garrett Watson, a senior policy analyst at Fiscal Foundation . The IRS says both portals will open on July 1.

Eligibility Information for Children with Disabilities

Children with disabilities may qualify for the child and care credit separately from the child tax credit, Watson said. You may be eligible for this credit if you paid expenses for the care of an eligible dependent to enable you to work, according to the IRS. Watson says the child discount applies to children with disabilities in the same way.

Eligibility Details for Shared Custody Parents

“Double-dipping” benefits for the same child worked for the first two stimulus checks, where a loophole allowed unmarried parents to share custody with both claim the child as dependent in a specific situation. Which is that not the case with the 2021 child discount?. In fact, overpaying can result in you being asked to return the money to the IRS.

Surviving relatives must live with you for at least six months during the year

When you apply for the new child tax credit for your child, you should bear in mind that the child must live with you for at least six months a year. However, there are exceptions to this rule, including temporary absences. According to the IRS, “A person is deemed to have resided with you during periods when one or both of you is temporarily absent due to special circumstances,” including illness, education, business, vacation and military service.

A newborn child born later in 2021 also falls under the exception and is considered to be living with you all year round. However, according to Joanna Powell, Certified Financial Planner and General Manager at CBIZ, the IRS will work with the 2020 tax return, which does not include children born in 2021, so don’t forget to update your information in the portal.

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Additional rules for your next of kin

If your child is not a US citizen and does not have a Social Security number, there is no getting around this: they are not eligible. When you file your individual income tax return (Form 1040), you must list your dependents and their Social Security numbers when you claim them for the child tax credit.

This also applies to adopted children. An adopted child who is not a U.S. citizen and has an ATIN or ITIN (adopted/individual taxpayer identification number) is not eligible for the child tax credit, according to the IRS. “The child must have a BSN to be an eligible child to qualify for the child discount.”

This is different from the third stimulus check, where: households with mixed status status could receive a check and only one household member needed a social security number.

For more information, here is what you need to know about the 2021 child discount, when the CTC payments will come and qualifications for parents to receive the payments.

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