How the Child Tax Credit Works for Divorced Parents and Other Non-Traditional Families

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But many families are unsure if their child qualifies for the credit, particularly for newborns or custody issues, based on questions asked during an online discussion ahead of the first distribution on July 15.

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Ken Corbin, IRS Commissioner of Pay and Investment and Principal Taxpayer Experience Officer, joined me in the chat to take questions for readers. There were hundreds of people seeking to clarify eligibility.

Below is a summary of the most frequently asked questions and responses to queries that we were unable to reach during the discussion, edited for length and clarity. IRS spokesman Eric Smith also answered some questions.

Frequently Asked Questions I have a child born in June, does she qualify for the advance child tax credit? If the parents of minor children are separated, but not divorced, and file joint returns in 2019 and 2020, do they split the child tax equally if my spouse is due in August, will we still be eligible for the program? What if I claim my child for 2020 because she was living with me but went to live with my ex this year? My son turns 18 in December. Will I get baby credit for 17 months? One of the conditions for accreditation is that the child must live with the taxpayer for half of the tax year. What about a child born at the end of the year? Is he eligible?

I have a child born in June, does she qualify for the advance child tax credit?

Corbyn: For tax year 2021, a qualifying child is an individual who has not turned 18 before January 1, 2022, and who meets the following conditions:

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– the individual is the taxpayer’s son, daughter, step-brother, eligible foster child, brother, sister, half-brother, half-sister, half-brother, half-sister or offspring of any of them ( For example, grandson, niece, or nephew).

An individual provides no more than half of his or her own support during 2021.

– The individual lives with the taxpayer for more than half of the 2021 tax year. The individual is properly called as the taxpayer’s dependent.

– If the individual is a US citizen, US citizen, or alien residing in the United States.

If the parents of minor children are separated, but not divorced, and file joint returns in 2019 and 2020, do they split equally on the child tax credit?

Corbin: If the child’s tax deduction is claimed by both parents, the advance payment will go to the bank account (usually a joint account) on the tax year 2020 return, or a check will be mailed to the record address on the tax return. Advance Child Tax Credit payments are based on the children claimed on the taxpayer’s 2020 tax return (or 2019 if 2020 has not yet been submitted).

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Later this year, the Children’s Tax Credit Update (CTC UP) portal at irs.gov will be updated to allow taxpayers to notify us of the eligible children they will claim on their 2021 tax return so we can adjust the estimated Child Tax Credit.

If my wife’s appointment is in August, will we still be eligible for the program?

Individual: The IRS says that children born this year are eligible for advance payments. Once the child receives a Social Security number, you can submit this information to the IRS. But you will have to wait for the portal feature for these updates to be activated.

If the child qualifies, the IRS will come back and recalculate what you are owed and distribute the money over the remaining months for the advance payments.

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If the payments, for any reason, do not begin before the end of the year, you will have to claim the Extended Child Tax Credit payments when you file your 2021 return next year.

What if I claim my baby for 2020 because she was living with me but went to live with my ex this year?

Corbyn: They should take one of the following:

– Agree to allow the other parent to claim this child for the 2021 Child Tax Credit. They must receive from the other parent IRS Form 8332 signed, Revocation/Cancellation of Child Exemption Exemption by the Guardian Parent, and attached to their 2021 tax return, They are asking for the children’s tax credit.

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Consider using the update portal to opt-out from receiving a child tax credit payment in advance or to remove that child’s information that has been submitted to the IRS.

As a result, the child tax credit payment amounts in advance will be reduced in the future to account for that child’s exclusion.

If they take no action, they may need to repay the amount of the Advance Child Tax Credit payments received for that child when they file their 2021 tax return next year with the IRS.

My son turns 18 in December. Will I get baby credit for 17 months?

Corbyn: For tax year 2021, a qualifying child is an individual who has not turned 18 before January 1, 2022.

A condition of credit is that the child lives with the taxpayer for half of the tax year. What about a child born at the end of the year? Is he eligible?

Smith: A child born at any time during the year matters, even on the last day.

I am divorced and share custody of my daughter with my ex-wife. We are cross-claiming our baby girl, and I have claimed her in 2020. Should I opt out of the monthly tax credit?

Individual: If you will not claim the child for 2021, you must opt-out from receiving the monthly payments. Otherwise, you may have to return that money next year. You have until August 2 to stop payments. The next deadline for canceling registration is August 2nd.

I’m not a US citizen, but my three kids are. I am a legal resident of the United States and pay taxes. Do I qualify for the tax credit?

Smith: In general, yes. As a legal resident, you usually have a Social Security number. Resident aliens for tax purposes are the same as citizens.

My sister and her children live in Canada but are US citizens. Are they eligible for advance payments?

Corbin: No, you must have had your primary home in one of the 50 states or the District of Columbia for more than half a year.

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Singletary: However, your sister may still be able to claim the credit when she returns in 2021. By the way, Puerto Ricans will not receive the advance payments distributed from July to December, but may be eligible for the temporary credit increase, which is $3,000 In 2021 for children 6-17 years old and $3,600 for children aged 5 years. and under.

The IRS also says that residents of American Samoa, the Commonwealth of the Northern Mariana Islands, Guam or the US Virgin Islands may be eligible for advance child tax credit payments but should check with their local tax agency.

Can a grandmother who is the breadwinner of a family who is having a grandchild claim credit?

Individual: If a grandmother can claim sons, she is entitled to credit, assuming she qualifies on the basis of income.

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