IRS launches new online sign-up for advance child tax credits

A child plays at a Philly sprayground

Elated children at Finley Recreation Center in Philadelphia run through the sprayground on the first day of operation, May 27, 2021. (Kimberly Paynter/WHYY)

Families eligible for the 2021 child tax credits, but who do not need to file taxes, have a new way of enrolling in the federal stimulus program.

The IRS has launched an online portal to sign up for the credits, which will start hitting bank accounts in mid-July.

Advocates had been pushing for a simplified process to make sure people who do not file taxes, for example because they rely on disability payments or earn too little income, can still access the program when eligible.

“What this does is it brings people into the tax system in a less stressful, more streamlined way,” said Kristen Dama, managing attorney with Philadelphia-based Community Legal Services.

The Philadelphia Mayor’s Office of Policy was among the groups pushing for the portal, warning in a policy document this April that “there is confusion even among tax professionals” as to whether a tax return is necessary to qualify for the program. The creation of a portal that could allow people to put in their information from a mobile phone, or at a trusted community site, would go a long way toward getting eligible households into the system, officials argued.

If every eligible family received them, the credits could lift 75,000 households in Philadelphia out of poverty in one year, according to a city analysis of U.S. Census data.

In Pennsylvania, an estimated 363,000 residents receive another form of government support, such as food stamps or Medicaid, but have been missing out on federal stimulus payments, according to a 2020 report by the left-leaning Center on Budget and Policy Priorities. That is one measure for people potentially left out of the child tax credits, whom the portal could help reach.

While the program is called a tax credit, it functions more like a benefit, providing cash to families with children under 18 rather than reducing the tax burden. Half of the total benefit amount, up to either $3,000 or $3,600 per child, will be dispensed in monthly, advanced installments.

For each child under 6 years of age, parents will receive up to $300 per month. For kids ages 6 and up, the amount is up to $250 per month. Those dollar amounts start dropping as income increases above $75,000 for a single filer, and $150,000 for joint-filers.

The IRS is expected to launch another portal, similar to the one used to track stimulus payments, where recipients can verify their information and track their payments, in the near future, said Dama.

Broke in PhillyWHYY is one of over 20 news organizations producing Broke in Philly, a collaborative reporting project on solutions to poverty and the city’s push towards economic justice. Follow us at @BrokeInPhilly.

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