The Internal Revenue Service (IRS) has announced that the first monthly payment of the expanded Child Tax Credit (CTC) from the American Rescue Plan will be made on July 15.
Roughly 39 million households, covering 88% of children in the United States, are set to begin receiving monthly payments in light of this.
The IRS and Treasury also announced the increased CTC payments will be made on the 15th of each month unless the 15th falls on a weekend or holiday.
Families who receive the credit by direct deposit can plan their budgets around receipt of the benefit. Eligible families will receive a payment of up to $300 per month for each child under age 6 and up to $250 per month for each child age 6 and above.
The American Rescue Plan increased the maximum Child Tax Credit in 2021 to $3,600 for children under the age of 6 and to $3,000 per child for children between ages 6 and 17.
The plan is projected to lift more than five million children out of poverty this year, cutting child poverty by more than half.
Households covering more than 65 million children will receive the monthly CTC payments through direct deposit, paper check, or debit cards, and IRS and Treasury are committed to maximizing the use of direct deposit to “ensure fast and secure delivery”.
While most taxpayers will not be required to take any action to receive their payments, the Treasury and IRS said they will continue outreach efforts with partner organizations over the coming months to make more families aware of their eligibility.