Child Tax Credit Update: You Can Now Change the Bank Account Where the IRS Sends Your Payments
With roughly two weeks to go until the first monthly child tax credit payment hits Americans' bank accounts, the IRS has updated an online tool that allows parents to change where their money gets sent.
The agency announced Wednesday that it upgraded the child tax credit update portal on IRS.gov, an application created after the American Rescue Plan became law in March. Depending on their income level and child's age, families can receive monthly payments of up to $300 per kid in 2021 starting July 15.
The IRS is sending the first round of payments via direct deposit to the bank account it already has on file for eligible families. Like with the stimulus checks, this is the fastest way to get your money — if the IRS doesn't know your direct deposit information, it'll default to sending a paper check in the mail, which takes longer.
But what if the IRS has the wrong bank, your account is closed or you simply want your child tax credit payment to be deposited into a different account?
Until this week, there wasn't an easy way to rectify these problems. Now, through the Child Tax Credit Update Portal, families can change the information the IRS has on file by "updating the routing number and account number, and indicating whether it is a savings or checking account," according to a news release.
But there is a catch. Actually, two.
The first that your entire payment has to go to one account — you can't split it. The second is that you can only change your direct deposit info starting with the August child tax credit installment. July is locked in.
And, of course, there's a deadline you have to meet. If you want to change where the IRS sends your payment, you'll need to do so by Aug. 2 for it to take effect for the Aug. 13 deposit date. (The payments are supposed to drop on the 15th of every month, but in August that falls on a Sunday.) If you miss the August deadline, you can still change your information for September and onward.
Aug. 2 is also the IRS deadline for families who want to opt out of the payments starting in August. So read up, log on and keep an eye on your bank balance.
More from Money:
36 Million Families Are Getting Letters From the IRS About Changes to the Child Tax Credit
Child Tax Credit 2021: Everything to Know About Eligibility, Monthly Payments and More
The New Stimulus Bill Includes Monthly Payments to Millions of Parents. Here's How It Works