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truiz70
New Member

Planning for next year

My wife and I (married/filing jointly) are receiving the monthly disbursement for our 4 children in the amount of $1,050. As I understand, this will continue until December 2021. Therefore, the total amount I will receive is $6,300. Am I expected to repay this entire amount when I file next year?

2 Replies
AR_CPA2
Employee Tax & Finance Expert

Planning for next year

These are the payments for Child Tax Credit in advance, as long as you qualify for this credit, you do not need to pay it back...  Its just that instead of getting this money at the tax time, you are getting it in advance.  So as long as you still qualify for this credit in terms of your Adjusted Gross Income, you will get to keep it.  See the link below to see if you will qualify:

https://www.nerdwallet.com/article/taxes/qualify-child-child-care-tax-credit

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Mike9241
Level 15

Planning for next year

assuming you will be entitled to the CTC in 2021, the advance payment will reduce your refund or increase the balance due. you do have the option of opting out of the advance credit. should you not qualify for the CTC you'll have to repay the advance.

 

https://www.irs.gov/credits-deductions/advance-child-tax-credit-payments-in-2021 

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