The Internal Revenue Service has begun sending letters to more than 36 million American families that are eligible for an expanded child tax credit, with payments set to begin in July.
According to Illinois officials, the child tax credit stands to benefit approximately 2.5 million Illinois children.
The credit, which was brought into law by the American Rescue Plan that was passed earlier this year, will provide families with up to $3,600 for children under the age of 6, and $3,000 for children between the ages of 6 and 17, according to the IRS.
Those payments will begin going out in mid-July, and will be paid monthly through December, with families eligible to claim the rest of the funds when they file their 2021 tax returns.
To be eligible for the payments, filers must fit the following criteria:
-Maximum adjusted gross income of $75,000 for individual taxpayers
-Maximum adjusted gross income of $112,500 for head of household
-Maximum adjusted gross income of $150,000 for married taxpayers who are filing jointly
Families who have filed their 2020 taxes will automatically receive the payments beginning July 15. If a taxpayer did not file a return for this year, then the data will be based on 2019 returns, according to the IRS.
Eligible families would receive monthly payments of $300 per child age 5 and younger, while children age 6 to 17 will receive $250 monthly payments.
Most payments will be made via direct deposit, but paper checks will be mailed to families who have not shared direct deposit information with the IRS on previous tax returns.
The IRS says that it will allow families to opt out of the monthly payments, should the family instead choose to receive the $3,600 or $3,000 payment in full upon filing of 2021 tax returns. A website will be set up for families to opt out of the plan, should they choose to.
In order for parents or guardians to be eligible for the tax credits, children must have a valid Social Security Number, live with residents for at least half of the year, and be under the age of 18 as of Dec. 31, 2021. Parents or guardians must also claim the children as dependents on their tax returns.
Children are eligible if they are residents’ children, adopted children, stepchildren, half-siblings, foster children, grandchildren, nieces or nephews, or other relatives, provided that they are claimed as dependents on tax returns, according to the IRS.