Age of Qualifying Child
The age of a qualifying child has been increased for the 2021 tax year from 16 and younger to 17 and younger. A qualifying child is defined as any under-age-17 child who can be claimed as a dependent for the year.
Maximum Child Tax Credit
CTC Refundable for Eligible Taxpayers
The CTC for 2021 is fully refundable if you or your spouse have a principal residence in the US for more than half of the year or if you are a bona fide resident of Puerto Rico.
Advance CTC Payments
Another big change implements monthly advance payments of the credit starting this month, July, through December 2021. The advance payments will total 50% of the taxpayer’s allowable CTC for 2021. The estimated allowable CTC will be based on the taxpayer’s 2020 personal tax return or their 2019 return if 2020 has not yet been filed.
Please contact Alexis Wilson or any member of the Baker Holtz team at 616-458-1835 if you have any questions regarding the changes to the Child Tax Credit.