January 10, 2022 — The IRS has started issuing information letters (Letter 6419) to advance child tax credit recipients. Under the American Rescue Plan Act, the child tax credit was expanded to provide needed tax relief to almost all working families with children. It authorized the IRS to pay one-half of the expected child tax credit in advance and claim the other half upon filing your 2021 income tax return.
Single taxpayers with modified adjusted gross income < $75,000 are eligible for the full credit and it phases out completely at $200,000 of modified AGI. Married filing joint taxpayers are eligible for the full credit if modified adjusted gross income < $150,000 and phases out completely at $400,000 of modified AGI.
If you receive an advance child tax credit information letter, please keep these letters, do not throw them away. Please submit the letter with your 2021 tax documents, as it will assist tax preparers in completing your 2021 Federal income tax return.
The third round of Economic Impact payments were issued starting in March, 2021. These were advance payments for the 2021 Recovery Rebate Credit that will be claimed on your 2021 income tax return. The IRS will begin issuing Letter 6475 to all EIP recipients in late January.
Again, please keep these letters and do not throw them away. Please submit the letter with your 2021 tax documents, as it will assist tax preparers in completing your 2021 Federal income tax return.