October 29, 2021
The IRS will launch a feature that will let people receiving monthly Child Tax Credit payments to update their income using the Child Tax Credit Update Portal (CTC UP) on Monday, November 1st.
You should enter any significant income changes by midnight on November 1st so that they will be reflected in their November payment, which is scheduled for November 15. If you're unable to make the changes on November 1st, enter them by November 29 so that they are reflected in your December payment. Once the update is made, the IRS will adjust the remaining payment amounts to ensure you receive the total advance payment for the year. For married couples, if one spouse makes the income update, it will apply to both spouses and could impact both spouses' future monthly advance payments of the Child Tax Credit.
Who should use the income feature
This new income feature can help you make sure you're getting the right amount of advance Child Tax Credit payments during 2021. It's especially useful to people who want to raise or lower their monthly payments because their 2021 income has risen or fallen substantially compared to 2020.
A large income change can raise or lower your monthly payments in many cases. Small changes in income won't impact the payment amount and don't normally need to be entered into the CTC UP.
Any change to the monthly payment amount will be reflected in both the November 15 and December 15 payments if a you complete your updated income request before midnight on Monday, November 1. Changes made after that date, before midnight on November 29, will only impact the December 15 payment, which is the last scheduled monthly payment for 2021. The IRS will adjust the payment amount to reflect these changes and make sure you receive your total advance payment for the year up to $1,800 for each child under age 6 and up to $1,500 for each child ages 6 through 17.
Who qualifies for a bigger payment
People currently receiving monthly payments below the maximum may qualify to have their payments increased in some cases; for example, if you experienced job loss in 2021, or for some other reason are receiving substantially less income this year. If the reduction in income is large enough, reporting that change now may increase the amount of your advance CTC payments for the rest of this year.
For people already receiving the maximum payment, a drop in income will not increase the payment amount. The maximum CTC payment is normally $300 per month for each qualifying child, under the age of 6, and $250 per month for each child, ages 6 to 17.
Most people are receiving half of the total CTC through monthly payments. Any changes entered into the CTC UP will increase or decrease their monthly payments to make sure they receive half of their total expected credit before the end of 2021. They will claim the remaining portion on their 2021 tax return.
Who should have their payments reduced
Anyone whose income rose substantially in 2021 should consider having their payments reduced, especially if they are now receiving the maximum monthly payment and expect to qualify for less than the full credit when they file their 2021 federal income tax return. See Topic C of the agency's Frequently Asked Questions for more information on calculating the CTC. See QC 4 & QC 5 for information about when a family qualifies to receive less than the full amount.
Using the portal to report income changes
Only people already eligible for and receiving advance CTC payments based on their 2020 tax return can use the CTC UP to update their income. If you filed a joint return for 2020, you can only update your income if you plan to file a joint return for 2021 with the same spouse. IRS representatives can't process income changes over the phone or at Taxpayer Assistance Centers.
The Update Portal will acknowledge a change was made but will not display the change after an income update is completed. IRS representatives won't be able to confirm that an update was made.
There's still time to sign up
It's not too late to sign up for advance CTC payments.
People not already receiving payments who normally aren't required to file a tax return can visit the tools available on the IRS website to help determine eligibility for the advance CTC or for help filing a simplified tax return to sign up for these payments as well as Economic Impact Payments and the Recovery Rebate Credit.
The deadline to sign up is November 15, 2021. People can get these benefits even if they don't work and even if they receive no income.
People who sign up will normally receive half of their total Child Tax Credit on December 15. This is a payment of up to $1,800 for each child under 6, and up to $1,500 for each child ages 6 to 17.
Get ready to file next year
People will receive Letter 6419 documenting any advance payments issued to them during 2021 and the number of qualifying children used to calculate the advance payments in early 2022. This letter can help them accurately reconcile the advance CTC payments they have received and claim any remaining portion of the CTC when completing their 2021 federal income tax return next year.
Along with the income change feature, the portal also allows families to verify their eligibility for the payments and then if they choose to:
Switch from receiving a paper check to direct deposit
Change the account where their payment is direct deposited
Update their address
Stop monthly payments for the rest of 2021.
Latest information available from the IRS
The IRS created an Advance Child Tax Credit 2021 page to provide the most up-to-date information about the credit and the advance payments at IRS.gov/childtaxcredit2021.
People can check their eligibility by using the advance Child Tax Credit Eligibility Assistant.
The webpage features a set of frequently asked questions and a user guide for the Child Tax Credit Update Portal (Publication 5549). It has links to the portal, and two other online tools – the Non-filer Sign up Tool and the Child Tax Credit Eligibility Assistant as well as other useful resources.