Monthly child tax payments could be delayed along with refunds

Local News

FORT WAYNE, Ind. (WANE) — Tax season is underway and with it comes several changes.

“Tax season is strange this year but we are trying,” said Jackson Hewitt Tax Professional Linda Troyer. “The IRS not keeping us updated in a timely fashion and making changes quickly has left us behind.”

A lot of those changes stem from the recent passage of the American Rescue Plan. A portion of the plan is the advance against the child tax credit for 2022. This will increase the child tax credit from $2,000 to as much as $3,600 per child.

Parents or guardians of children under age 6 would be eligible for an even larger $3,600 total credit. The plan also includes $3,000 benefits to the parents of 17-years-olds who meet the qualifications. Previously children had to be 16-years-old or under.

Those who qualify would receive half their 2021 tax credit starting in 6 monthly payments starting July 1. However, with the IRS behind due to COVID, the start date could be pushed back.

For those who want to opt-out of the monthly payments and receive all their refund next year. Troyer believes the IRS will send parents a letter to fill out which will need to be sent back to stop monthly payments. But at this time the IRS has not released any specific information.

Any changes to taxes normally take place in December. This year, however, the IRS has made changes throughout tax season. With the added third round of stimulus checks, the department is behind. Experts aren’t sure how far behind tax processing is, but they know the IRS is still working on 2019 returns. This has caused a delay in not only stimulus checks but tax returns.

“They started several weeks late,” Troyer said. “But most people will get their refunds within 21 days. It’s not a promise but that’s when you should see it by.”

Another recent change to how unemployment is taxed will also affect refunds. The IRS is now allowing $10,200 dollars to be waived, making it tax-free. For those who have already filed unemployment, the IRS is working to find a way to automatically increase their refund.

The tax deadline has been moved the deadline to May 17 from the usual April 15. However, Troyer says the sooner you can get your taxes done the better.

“There are just so many changes this year its best idea is to use a tax professional,” Troyer said. “Even though the tax season has been extended you should go in as soon as you can and get it done.”

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