Advance Child Tax Credit Payments

Tax Filing Update

Pursuant to the changes set forth in The American Rescue Plan, the Department of Treasury will be automatically issuing advance payments of the Child Tax Credit to eligible taxpayers beginning July 15^th 2021. Here is what you should know:

For tax year 2021 the Child Tax Credit (CTC) has been increased to $3,000 per child between the ages of 6 and17 and $3,600 for children under 6. 50% of the refundable credit will be automatically paid in advance monthly payments from July through December.
The maximum credit is available for taxpayers with a 2021 Modified Adjusted Gross Income of:
- $75,000 or less for single taxpayers
- $112,500 or less for head of household
- $150,000 or less for married couples filing joint, widow(er)s
If you are eligible based on your 2020 (or 2019) tax filing, no action is needed to receive payments. They will be automatically deposited if the IRS has your bank account information on file, if the IRS does not have bank account information on file you will automatically receive a check to the address on your most recent tax return.
If you were eligible for the CTC based on 2020 income, but you do not believe you will be eligible based on 2021 income, we recommend that you opt out at www.irs.gov/childtaxcredit2021. Unlike other covid-related tax credits, any credits issued to ineligible taxpayers will have to be repaid when filing your 2021 tax return. Similarly, any eligible taxpayers that do not receive the credit in advance will receive the full credit when filing their 2021 tax return.

Let us know if you have any questions. For example, if your 17-year-old child turns 18 in 2021 you are not eligible to receive a credit for that child.

Truly Yours,

Reason Financial

Disclosure

This material is for general information only and is not intended to provide specific advice or recommendations for any individual. There is no assurance the views or strategies discussed are suitable for all investors or will yield positive outcomes. Investing involves risks including possible loss of principal. Any company names noted herein are for educational purposes only.

All information is believed to be from reliable sources; however we make no representation as to its completeness or accuracy. All economic and performance data is historical and not indicative of future results. Market indices discussed are unmanaged. Investors cannot invest in unmanaged indices. Additional risks are associated with international investing, such as currency fluctuations, political and economic instability and differences in accounting standards.

Investing in securities in emerging markets involves special risks due to specific factors such as increased volatility, currency fluctuations and differences in auditing and other financial standards. Securities in emerging markets are volatile and can decline significantly in response to adverse issuer, political, regulatory, market, or economic developments.

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Investing in fixed income securities involves credit and interest rate risk. When interest rates rise, bond prices generally fall. Investing in commodities may involve greater volatility and is not suitable for all investors. Investing in a non-diversified fund that concentrates holdings into fewer securities or industries involves greater risk than investing in a more diversified fund. The equity securities of small companies may not be traded as often as equity securities of large companies so they may be difficult or impossible to sell. Neither diversification nor asset allocation assure a profit or protect against a loss in declining markets. Past performance is not an indicator of future results.

Financial Planning offered through Reason Financial, a state Registered Investment Advisor. Investment advice offered through Merit Financial Group, LLC an SEC Registered Investment Advisor. Merit Financial Group and Reason Financial are separate entities. Tax related services offered through Reason Tax Group. Reason Tax Group is a separate legal entity and not affiliated with Merit Financial Group, LLC. Sean P. Storck CA Insurance Lic#OF25995 and Steven W. Pollock CA Insurance Lic#OE98073

Advance Child Tax Credit Payments

Tax Filing Update

Disclosure

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