Child Tax Credit 2021: What to do if you didn't get a payment or got the wrong amount

The first of six monthly payments through the enhanced Child Tax Credit arrived on July 15, with most parents of children who are 17 or younger getting one of the deposits. But some parents are reporting they haven't yet received a check — or that they got the wrong amount. 

The IRS said it sent payments for almost 60 million children on Thursday, totaling $15 billion. But some parents who expected checks to land in their bank accounts that day were disappointed, either because they didn't receive any money or got less than they expected. 

It may not be surprising that some parents are reporting problems with the enhanced CTC, given that the massive new program is determined by a family's 2019 or 2020 tax return. The IRS has been reaching out to parents who normally don't file taxes in order to urge them to file a simplified return that will qualify them for the program. But other people may be experiencing bumps that aren't as easy to fix. 

"It's a new thing, and anytime you have a new important thing you get bumps," said Mark Steber, Jackson Hewitt's chief tax information officer.

Many of the issues parents are experiencing are tied to misunderstandings about eligibility, Steber said. That assertion was echoed by the IRS, which noted that income phaseouts and the age of a child might be causes of people getting less money than they expected.

But other issues might also delay some people from getting checks until later this year or even until 2022. Here are some of the challenges parents are reporting, along with possible fixes. 

Can I get a check for a child born in 2021?

People who welcomed children into their families in 2021, whether through birth, adoption or fostering, may be eligible for the checks, as long as they meet other eligibility criteria. (To see more on eligibility, click here.) But they wouldn't have received a check on July 15 because the IRS doesn't yet know about the child's existence. 

That's because the IRS is basing CTC payments on either your 2019 or 2020 tax return, whichever is more recent. In either case, the tax agency won't know that you had a child in the current year. 

There will soon be a way to fix that, however. The IRS said it will be offering families the ability to add children born or adopted in 2021 to its Child Tax Credit Update Portal. New parents should keep checking the Update Portal for the new function, although it's unclear when exactly it will be added. The IRS says it will be "later this year."

The IRS sent my check to a closed account

It's possible that the IRS directed your check to a closed or inactive bank account, which is why Steber recommends that taxpayers check to make sure the tax agency has the most up-to-date information.

Begin by checking the Child Tax Credit Update Portal, which will tell you some basic information about where the IRS is directing the check, such as your address and bank account. That will alert you if the IRS is sending the money to either a closed account or an old address. 

If the IRS sent the check to a closed account, the deposit will be rejected and the tax agency will reissue a paper check and mail it to your physical address. 

"But if your address on your last tax return isn't where you want the check, that's a problem, with no real easy fix at this point," Steber said. "There is an IRS change-your-address form, but that takes six weeks" to process, he said. 

The IRS' Child Tax Credit Update Portal later this year will add a function allowing people to update their bank account or mailing address, another addition people should watch for if they moved or changed bank accounts since they last filed their taxes. 

I haven't filed my taxes — will I get a check?

If you haven't filed your 2020 taxes yet, the IRS will look at your 2019 tax returns to determine your eligibility. 

But if you haven't filed either your 2019 or 2020 tax return — there are millions of Americans who don't have to file taxes because their income is too low to require an annual return — you may not get a check because the IRS needs some of that information to process CTC payments. 

In that case, people should go to the Child Tax Credit Non-Filers tool to provide information to the IRS that will allow the agency to determine eligibility and send out the payments. 

My child is 5 but only got $250. Why?

Under the Child Tax Credit, children who are 6 or younger should receive $300 per month, while children ages 6 to 17 will receive $250 per month. 

But there's a catch: The child needs to younger than 6 as of December 31, 2021 to receive the full $300 credit. That's because the Child Tax Credit is for 2021, which means that a 5-year-old who turns 6 within the 2021 calendar year won't qualify for the bigger payment. 

"A lot of people who have a 5-year-old — say they turn 6 in November — say, 'Why am I getting $250?'" Steber said. "It's not aged 5 and under sometime during 2021," but for children who are under 5 as of midnight on the last day of 2021. 

My child is 17 but I didn't get anything. Why?

Similar to the issue above, the tax law only covers children who are 17 years old as of December 31, 2021. In other words, a 17-year-old child who turns 18 during 2021 doesn't qualify for the CTC. 

My tax return was amended and is still being processed. Is that a problem?

Yes, said Steber. Also, tax returns that are currently being held for review by an IRS employee — and there are 35 million of these returns — may also face delays, he said.

"The IRS has made it kind of clear that you have to have to have a completed tax return on the IRS system," Steber said. "If you have a tax return caught up in the error resolution system — and there is an abundance of situations that can turn into that — if it's not completely processed, we understand those returns are affecting the advanced payments" for the CTC.

In that case, taxpayers may get the CTC payments when their return is processed. For instance, if the return is processed in September, the CTC payments could begin in October. But if a return isn't processed until after the advanced payments for the CTC end in mid-December, the taxpayer will receive the entire CTC credit when they file their taxes in early 2022. 

In:
• Internal Revenue Service
• Child Tax Credit