Anyone get their child tax credit check in the mail yet?

Non-investing personal finance issues including insurance, credit, real estate, taxes, employment and legal issues such as trusts and wills
Post Reply
Topic Author
MTZ
Posts: 57
Joined: Sun Oct 07, 2018 11:38 pm

Anyone get their child tax credit check in the mail yet?

Post by MTZ »

We got ours this past week.

I'm a bit confused about it because we are over the $150k income limit so I assumed we wouldn't qualify but the check showed up anyway. Will we have to pay it back? I think the amounts start to phase out so maybe that's what happened in our case? Feels too good to be true..
rage_phish
Posts: 350
Joined: Thu Jan 31, 2019 4:27 pm

Re: Anyone get their child tax credit check in the mail yet?

Post by rage_phish »

We’re over the 150. But it’s not a hard stop

But got a pro rated amount dd on the 15th
gtaylor
Posts: 349
Joined: Tue Feb 17, 2009 3:22 pm

Re: Anyone get their child tax credit check in the mail yet?

Post by gtaylor »

Yes. I was surprised, too. Turns out the phase-outs are in two ranges with a big gap in between.

The newest Biden-era "America Rescue Plan" CTC thing is a temporary of 1000 or 1600 extra per kid (depending on age). This extra amount has a phaseout range starting from 150k. This phaseout is $50 per $1000 over 150k AGI. It will stop phasing out when just the extra ARP amount hits zero, at 170 or 182. So if your AGI is in the high 100s or over you would expect this newer extra amount to be zero.

The older Trump-era "Tax Cuts and Jobs Act" CTC of $2000 per kid has a different phaseout range starting for an AGI value over 400k. This is as it always has been, it is just more confusing with the extra amount from the ARP bolted on.

The "advance" introduced in the ARP is half, so half of whatever isn't phased out (using last year's AGI), divided by the 6 months left in the year, is what you should expect to get a check for.

AFAICT, unlike the ACA Advance Premium Tax Credit for this and last year's health insurance, these Advance Child Tax Credit payments will still be reconciled on your taxes next year. So there are buttons on the IRS website to say "Don't send me these" if you prefer. Assuming your 2020 income was similar to 2021, you would expect to have the other, not advanced, half be a credit at tax time.

https://www.irs.gov/credits-deductions/ ... ts-in-2021
Alto Astral
Posts: 737
Joined: Thu Oct 08, 2009 10:47 am

Re: Anyone get their child tax credit check in the mail yet?

Post by Alto Astral »

MTZ wrote: Sun Jul 18, 2021 2:16 pm I'm a bit confused about it because we are over the $150k income limit so I assumed we wouldn't qualify but the check showed up anyway. Will we have to pay it back?
Got mine as a direct deposit. I was above the income limit in 2021 and should be even more in 2021. I'm just going to pay it back vs going through the hassle of trying to stop it. I'll just be slightly unhappy if they charge an interest on anything I need to pay back.
Topic Author
MTZ
Posts: 57
Joined: Sun Oct 07, 2018 11:38 pm

Re: Anyone get their child tax credit check in the mail yet?

Post by MTZ »

I think 400k is the real income limit where you start to lose most of the credit.. We are below 400k and above 150k so not getting the full credit but still a good chunk of it.

I found this article and calculator, it predicted our monthly payment correctly. I"m gonna go ahead and cash the check..
https://www.kiplinger.com/taxes/602334/ ... calculator
User avatar
Eagle33
Posts: 1466
Joined: Wed Aug 30, 2017 3:20 pm

Re: Anyone get their child tax credit check in the mail yet?

Post by Eagle33 »

This time is different and I predict numerous future forum postings, especially during 2021 tax filing season. Plenty of people will be surprised/complaining that they owe money next April because of this credit and their 2021 AGI.
Rocket science is not “rocket science” to a rocket scientist, just as personal finance is not “rocket science” to a Boglehead.
dred pirate
Posts: 190
Joined: Tue Nov 27, 2018 11:46 am

Re: Anyone get their child tax credit check in the mail yet?

Post by dred pirate »

I got the direct deposit amount of $167 on the 15th - like you I was expecting $0 since my AGI was $183 in 2020 and likely ~190 in 2021. So I know i will "lose" some of the gain they factored in. But likely not enough to worry about it on my tax planning
zeeke42
Posts: 81
Joined: Sat Feb 14, 2015 5:13 pm

Re: Anyone get their child tax credit check in the mail yet?

Post by zeeke42 »

I get the point of the advance in the lower brackets, but at my income level (and my understanding of how US income taxes work), it's just stupid. I pay thousands in withholding every month, but they're going to send me like $150 of it back?
User avatar
rob
Posts: 3660
Joined: Mon Feb 19, 2007 6:49 pm
Location: Here

Re: Anyone get their child tax credit check in the mail yet?

Post by rob »

I was surprised that I got one a few days ago.... One of the more bonehead moves, as far as I know we are not eligible for the credit. This whole thing is poorly thought out and just adds complexity & confusion come tax time.....
| Rob | Its a dangerous business going out your front door. - J.R.R.Tolkien
Fishing2retire
Posts: 80
Joined: Mon Jun 10, 2019 2:02 pm

Re: Anyone get their child tax credit check in the mail yet?

Post by Fishing2retire »

Got our $800 dollar check last week. We don’t necessarily need it but it’s nice to have. We are deciding on how to use these checks. Most likely fund our HSA or put in our savings account or split the difference in both.
User avatar
galawdawg
Posts: 2780
Joined: Thu Dec 14, 2017 12:59 pm
Location: Georgia

Re: Anyone get their child tax credit check in the mail yet?

Post by galawdawg »

zeeke42 wrote: Mon Jul 19, 2021 7:26 pm I get the point of the advance in the lower brackets, but at my income level (and my understanding of how US income taxes work), it's just stupid. I pay thousands in withholding every month, but they're going to send me like $150 of it back?
That's how the federal government works when it comes to these handouts/entitlements/grants and other similar programs. Take $500.00 from you, waste $350.00 of it, and then give $150.00 back to you. :oops:
Glockenspiel
Posts: 1177
Joined: Thu Feb 08, 2018 1:20 pm

Re: Anyone get their child tax credit check in the mail yet?

Post by Glockenspiel »

We got ours in the mail yesterday, for $333 for our 6- and 3-year old kids. Our AGI was between $250-$300k last year. We don't need the money but it's better to make programs more universal than cutting out a thin slice of the high income population to create an us vs. them scenario.
fareastwarriors
Posts: 1314
Joined: Tue Feb 14, 2012 12:31 pm

Re: Anyone get their child tax credit check in the mail yet?

Post by fareastwarriors »

Nice to know so many Bogleheads won't qualify.
:sharebeer

I don't kids but I just wanted to share in the success of our community.
apple44
Posts: 75
Joined: Tue Feb 19, 2019 3:22 pm

Re: Anyone get their child tax credit check in the mail yet?

Post by apple44 »

We got $333. Our AGI is over $400,000. Honestly it feels wrong for our family to receive it...

Also, Jeff Bezos claimed and received child credit for three years, after he became the richest person in the world (I guess he stopped claiming child credit after three years because he or his accountant felt ashamed maybe?). I remember feeling angry after reading that. Our tax system only looks at one's "income" and not stock options or wealth, but it really should take into account those things, in my opinion.
ChrisRx
Posts: 24
Joined: Fri Jan 03, 2020 10:33 pm

Re: Anyone get their child tax credit check in the mail yet?

Post by ChrisRx »

No, but is that because of the amended return from 3 months ago that they (irs) have not yet adjusted?
MrBeaver
Posts: 393
Joined: Tue Nov 14, 2017 4:45 pm

Re: Anyone get their child tax credit check in the mail yet?

Post by MrBeaver »

We received ours as expected. But it went to the account I used for direct deposit stated in my 2019 tax return, even though I checked the IRS website they set up specifically for these payments and it listed the bank account I used on our 2020 tax return.

In a similar confusing manner, the first two 2020 COVID rescue payments went to my 2018 and 2020 tax year return direct deposit account, while the third in early 2021 was deposited into my 2019 tax return direct deposit account.

I guess I’ll have to keep that 2019 ‘fluke’ account open forever now, for fear that the IRS will send money to it some time in the next 30 years.
Post Reply