The rules for the 2020 Child Tax Credit have not changed. The new tax law with respect to the Child Tax Credit is for tax years beginning after 31 December 2020.
SEC. 9611. CHILD TAX CREDIT IMPROVEMENTS FOR 2021.
(a) In General.—Section 24 of the Internal Revenue Code of 1986 is amended by adding at the end the following new subsection:
“(i) Special Rules For 2021.—In the case of any taxable year beginning after December 31, 2020, and before January 1, 2022—
I get that. but how will they know to advance me the child credit now they I'm eligible due to the package, if turbo tax keeps saying I'm not eligible by the suspended rule, old rule. ???
Everything will be updated to reflect the new rules in the American Rescue Plan. The IRS is finalizing the changes and TurboTax will implement everything as soon as possible. The process will take a little time.
okay thank you, so should I hold off on filing then for a bit?
The American Rescue Plan Act will pay advance payments starting in the middle of 2021. These will be based on the previous year tax return; either 2020 or if not available , 2019.
There is no reason to hold off filing for the new Child Tax Credit.
If you received Unemployment in 2020, and have not filed yet, then you should hold off on filing. Otherwise, you would be able to file now.
well but I'm not eligible for it based on the old provisions and turbo tax is NOT letting me say I'm now eligible for the child tax credit. I have no income. so how will the irs know to give me the child tax credit? do you understand what I'm saying, I hope I'm making sense.
TurboTax is working with the IRS to update software. No changes have been rolled out yet. The child tax credit increase applies to 2021 income taxes, but lawmakers believe that part of the increase will be paid out later this year.
American Rescue Plan
okay so in regards to that, there won't be an update for 2020s child tax credit, should I file now then to establish the baseline for the advancement of the 2021 credit?
The American Rescue Act changes will be on the 2021 tax forms. You can file now with 2020 returns. Many lawmakers believe that some of the enhanced child tax credits will be paid later this year.