The issue is that by "giving" us $500 a month per child early we then do not get to deduct it on our return. I'm in the same boat as some here. I have 2 kids so there should be a credit of $6000 but I already got $3000 of it and that $3000 does not show up on the return, only the "remaining" $3000 does. Last year I got back $144, this year I have to pay $376. Had I not already received $3000 I would be getting back $2624 (3000-376). My taxable income was actually a little less than 2020 and my total tax owed was $355 less but, since I already received $3000 I now have to "pay back" $376.
Right after they started sending out the $500 a month payments I figured it would mean we would end up "owing". I didn't know I could have opted out. So instead of getting a nice return in April I got it from from June through December. I'm sure for a lot of people having the extra money each month was helpful but the IRS should have done a better job of explaining that it was going to make people's amount they would get back less than it would have been with no advance payments.
