The Internal Revenue Service says it has updated the online frequently asked questions (FAQs) for the 2021 Child Tax Credit and the Advance Child Tax Credit.
The objective, the agency says, is to help qualified taxpayers to claim the credit properly on their 2021 income tax return.
The refurbished FAQs include streamlined questions to help individual taxpayers and tax professionals alike navigate to the answers they need most.
A total of 14 topics have gotten the update treatment, including:
- Topic A: General Information
- Topic B: Eligibility for Advance Child Tax Credit Payments and the 2021 Child Tax Credit
- Topic C: Calculation of the 2021 Child Tax Credit
- Topic D: Calculation of Advance Child Tax Credit Payments
- Topic E: Advance Payment Process of the Child Tax Credit
- Topic F: Updating Your Child Tax Credit Information During 2021
- Topic G: Receiving Advance Child Tax Credit Payments
- Topic H: Reconciling Your Advance Child Tax Credit Payments on Your 2021 Tax Return
- Topic I: U.S. Territory Residents and Advance Child Tax Credit Payments
- Topic J: Unenrolling from Advance Payments
- Topic K: Verifying Your Identity to View your Payments
- Topic L: Commonly Asked Shared-Custody Questions
- Topic M: Commonly Asked Immigration-Related Questions
- Topic N: Returning a Payment
The updated FAQs are likely to see a lot of action.
Taxpayers who received advance payments of the Child Tax Credit will have to compare the total of the payments they got during 2021 against the total amount of the Child Tax Credit they can claim on their return.
If the advance payments were less than the amount they qualify for, they can get the remainder as a refund. However, if the advance payments were more than the amount the filer qualifies for, then taxpayer will have to repay some—or all—of the excess.
To help them calculate just how much they got in advance payments, taxpayers are getting Letter 6419 from the IRS. The letter totals the amount of Child Tax Credit payments the taxpayer received during the course of 2021.
Filers receiving these letters are urged to retain them with their other income tax documents.
The IRS reminds taxpayers and tax pros alike that FAQs should not be relied upon for tax policy guidance in more formal arenas such as US Tax Court. Rather, the FAQs are used by the agency to get new and updated information to taxpayers as quickly as possible.
More information about such reliance is available on the IRS website.