Don’t get too worked up if you haven’t received your October Child Tax Credit cheque yet. The delay might be due to a simple cause.
Have you received your most recent Child Tax Credit payment? On Oct. 15, the IRS started sending the fourth batch of tax credit payments, and millions of families have already received the funds, either via direct deposit or mail. When all of the payments are made, almost 36 million households throughout the country will have received the money, which total $15 billion.
However, not every family has received their money this month. System difficulties and other challenges have caused delays or missed payments for families that should have received the maximum per-child payments of $250 to $300 in the previous several months. While many of these flaws have been fixed, the IRS’s payment system is still in need of improvement. If you haven’t received your tax credit check yet, there are a few reasons why it can be late.
1. You get your cheque in the mail rather than via direct deposit
If your Child Tax Credit payment is meant to come in the mail but hasn’t yet, it may be delayed due to a problem with USPS rather than the IRS. Direct deposit is the quickest method to get your monthly tax credit payment, since these funds are usually accessible within a day or two of the payment date each month.
Households that are expecting paper cheques in the mail, on the other hand, will have to wait a little longer. Because paper checks must pass through the mail system, they might take anywhere from a few days to a few weeks to arrive. If you usually get a paper check, you may want to wait a few weeks before calling the IRS for a payment trace.
2. Your spouse updated your IRS information, but you did not
To prevent missed checks or delays, if you file jointly with a partner or spouse and need to update your information with the IRS, all parties must update their information in the system. There have been a few instances of late or missing checks as a result of only one spouse updating their information in the Child Tax Credit Update Portal, so if your most recent check is missing, it could be because only one person in your household updated their bank account or mailing information in the tax credit system.
When one party updates their information but the other does not, the payment is divided in half, with one half going to the updated address or bank account and the other going to the old address or bank account. In September, this problem caused delays and missed payments for around 2% of families, and it might be the reason your most recent check is lower than usual or missing entirely.
3. Your information isn’t on file with the IRS
Have you filed a tax return for the years 2019 or 2020? If you don’t, the IRS may not realize you’re eligible for the tax credit, which might explain why you haven’t gotten your most recent payment. While non-filers may still qualify for the Child Tax Benefit without income if they fulfill the requirements, they must first sign up for the credit using the Child Tax Credit Non-filer Sign-up Tool. The IRS won’t know you qualify if you don’t submit a tax return, so you won’t get the money each month.
If you believe this could be a problem, the good news is that you still have time to join up. You may still use the non-filer tool to file for the payments, but you must do so by November 15. Otherwise, you’ll have to wait until next year’s tax season to collect the money you’re entitled from the Child Tax Credit.
4. The information you have on file with the Internal Revenue Service (IRS) is out of current
The IRS is determining whether you are qualified for the reimbursements based on your most recent tax returns. If you are confirmed to be eligible, payments will be sent to you automatically each month until you want to opt out. This makes it simpler for millions of families to benefit from the additional money, but it also creates problems for anybody who has seen a significant shift in circumstances in the prior year or two.
For example, you may have earned too much last year to be eligible for the payments, but if your income has changed significantly this year, you may suddenly be eligible. The IRS, on the other hand, will not be aware of the change in income until you submit your next tax return.
This might be a problem for parents who welcomed a kid into their family in 2020 or 2021, whether via adoption or natural birth. Your new kid may make your family eligible for tax payments — or an increase in tax payments — but you may be losing out right now because the tax agency has outdated information on file.
You have two options in these situations: wait until the IRS site permits you to amend this information in the system, or claim the money owing on your 2020 tax return. You won’t miss any payments in any case; you may simply have to wait a time to take benefit of it.
5. At some time, you opted out of the payments
It’s possible that you missed your most recent Child Tax Credit payment because you unenrolled from the payments earlier this year. The IRS Update Portal makes it simple to unenroll from monthly payments, but it’s not so simple to re-enroll in the payments.
If you believe this is the case, you have two choices for getting your October Child Tax Credit payment. One option is to wait until April 2021 to submit your taxes and recover the amounts you missed in one single sum. The second option is to re-enroll in Child Tax Credit payments, but you’ll have to wait until later this autumn when that capability becomes accessible in the update portal.