Advanced Child Tax Credit

Among the many changes that have happened within the IRS, the one change that is grabbing attention is the Advance Child Tax Credit Payment which began last month. This means that if you have eligible dependents you may receive advanced monthly payments of the increased Child Tax Credit that you would normally see on your tax return at year end. This can result in some tax planning issues if you are not careful. This is not another stimulus payment. This is the IRS sending you your refund earlier than normal. If you normally have a balance due after the child tax credit, this can result in a larger liability at year end if you do not prepare accordingly, by either increasing your estimated payments or opting out of the advance credit. To opt out of the Advance Child Tax Credit Payment go to IRS.gov and clicking on Get Details on the Advance Child Tax Credit. Be sure to talk with your tax advisor about how this affects your personal situation.