REPORT FAMILY CHANGES
One crucial caveat is that come 2022 tax season, if the family has undergone a significant change – new pregnancy, a wedding, new job, a kid turning 18 moving out of the house in 2021 – it could affect eligibility to receive the proper CTC credits.
If a family received more than they were supposed to, that money is likely going to have to be paid back to the IRS.
“This means that by accepting advance child tax credit payments, the amount of your refund may be reduced or the amount of tax you owe may increase,” according to the IRS.
One solution to prevent having to pay back the CTC payments to the taxman is to opt out for 2021.
Doing this will allow the family to assess the situation and file to receive a lump sum of up to $3,600 next year.
Essentially, a key way to offset having to pay back the feds for this money is to keep your family’s information updated.
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