Millions of American families with children have received four monthly payments through the new enhanced child tax credit.
But for families who still need to sign up for the benefit but haven't, time is ticking.
That's because after December, families will have to file a tax return and wait to get the entire credit as a refund from the IRS. On the other hand, families claiming the credit now will get cash up front and receive the second half when they file 2021 taxes next year.
There's also a limited window for families with eligible children to sign up if they didn't get checks automatically. The site GetCTC.org, begun by Code for America in collaboration with the U.S. Department of the Treasury and the White House, will only be available through Nov. 15.
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"If parents haven't already gotten the payment and they're eligible for it, it's not too late to sign up," said Ashley Burnside, a policy analyst at the Center for Law and Social Policy.
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Families enrolling for the credit now will see larger remaining payments than those who have been getting them monthly since July, when the checks began.
That's because the monthly money is an advance on a 2021 tax credit, half to be delivered this year and the rest to come when families file their taxes next year.
The American Rescue Plan passed in March expanded the existing child tax credit, adding advance monthly payments and increasing the benefit to $3,000 from $2,000 with a $600 bonus for kids under the age of 6 for the 2021 tax year.
For a family with two children aged 5 and 7 eligible for the full credit, the amount they'd receive is $6,600 ($3,000 for the 7-year-old plus $3,600 for the 5-year-old.)
If they filed a tax return in 2019 or 2020 and had direct deposit, the family started receiving the first $3,300 of the credit in six monthly payments of $550 from July to December.
But if the same family doesn't traditionally file taxes because they don't earn enough, they would need to sign up to get the monthly payments. If the family missed the July payment but signed up in August — as about 1 million families did — they'd still get $3,300 before December.
"Families who did not get a July or August payment and are getting their first monthly payment in September will still receive their total advance payment for the year of up to $1,800 for each child under age 6 and up to $1,500 for each child ages 6 through 17," the IRS said in a Sept. 15 statement, coinciding with the third monthly payment going out to families.
"This means that the total payment will be spread over four months, rather than six, making each monthly payment larger. For these families, each payment is up to $450 per month for each child under age 6 and up to $375 per month for each child ages 6 through 17," the agency said.
Those who wait to sign up in November will get the entire first half of the credit in one check in December, according to a Treasury official.
Why families should sign up now
To be sure, if a family fails to sign up for the new child tax credit this year they will miss out on advance payments but can still get the money in a lump sum next year by filing a tax return.
Still, that means they'll get the money months after it was intended to be delivered and may have to deal with IRS delays.
Experts say that everyone with an eligible child should sign up as soon as they are able, unless they are part of a family who know they want to opt out and receive the benefit in a lump sum next year.
"We would hate for money to be left on the table when people are hungry, when people have housing insecurities, food insecurities," said Otis Rolley, senior vice president of the U.S. equity and economic opportunity initiative at the Rockefeller Foundation.
It may also be important for families to claim the money now as the enhanced child tax credit may not be continued for much longer. Democrats are fighting to keep the credit for one more year, but that may not happen as lawmakers negotiate President Joe Biden's Build Back Better plan.
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