Hey, parents! Your child tax credit money may be on the way if you got this IRS letter

A letter from the IRS can be good news too, you know. A colleague got a letter in the mail from the IRS and assumed it was an audit notice. It wasn’t, and if you’ve received a letter from the IRS recently, it may also be about the advance child tax credit payments starting July 15. Thirty-six million families in the US will receive this same letter, with as many as 92% of households with children possibly receiving this extra money.

New rules set under the American Rescue Plan boost the child tax credit from $2,000 to $3,600 max per child. And unlike previous years, half of the total amount for the payment will be distributed automatically in advance of partial payments through the end of 2021. Parents have the option of deferring the monthly installments to receive the lump sum when filing taxes in 2022. 

But there’s something else you need to watch out for: a second letter from the IRS about your child tax credit payment amount. We’ll also tell you what it means if you don’t get a letter. In the meantime, you can use CNET’s child tax credit calculator to estimate your total and read more about how to spend your child tax credit money.

Who gets the most recent IRS child tax credit letter?

Congratulations. If a letter that looks like this (see directly below) arrives in the mail…

…it means the IRS thinks you could qualify for the upcoming child tax credit, based on information it has from your 2019 or 2020 tax return — or from details you filed using the nonfilers’ tool to get your stimulus check money. 

Until there’s a check in your hand or direct deposit in your bank account it’s not a good idea to treat this letter as a guarantee of a coming child tax credit payment, but it appears your chances are good. As with all IRS correspondence, hold on to this letter for your records.

Which families will get a personalized follow-up letter in the mail?

If you do get the go-ahead from the IRS to receive child tax credit payments (which start July 15) you’ll be treated to a second letter that confirms your eligibility. It also ballparks how much money you should expect to see in those checks. 

The 2021 child tax credit payment schedule gets a little complicated from here, but the upshot is that half the total money will arrive in increments from July through December, with the remaining money coming your way after you file taxes in 2022. 

You’ll want to keep this letter so you can compare the estimate with what you eventually receive and to make sure you get the right amount for the right number of children you claim. In case there’s a problem with child tax credit check delivery, this letter is almost like your receipt from the IRS, which you may need to reference in the future (like in a recovery claim on your 2021 taxes next year).

Can a family still qualify if they don’t get a letter from the IRS?

If a letter never shows up in your mailbox, that doesn’t necessarily mean the IRS is skipping you over for the child tax credit payments. After all, the vast majority of US households with children will receive some portion of the money earmarked for parents. 

For example, while 36 million families are intended to get a letter, up to 39 million households could qualify for the credit. That means off the bat, 3 million households could see a check, but no confirmation letter. 

You might not get a letter if the IRS:

What you can do now:

• If you’re normally not required to file taxes — someone the IRS calls a nonfiler — you’ll have a chance to update your details, like the number of children you can claim, using an online portal. It’s slated to open by July 1.
• If you haven’t filed your 2020 tax return yet but plan to, the IRS encourages families to do so as soon as possible using the Free File system available on the IRS website. That will allow parents to update their banking information. 
• If you moved, make sure the IRS and the US Postal Service have your current mailing address.
• Make sure you know the eligibility and income rules for parents and their kids, including shared custody situations.

For more information about the child tax credit, here’s how you’ll use the two online IRS portals launching by the start of July and what happens if you have a baby this year.