Child tax credit: Parents with babies born in 2021 can get up to $3,600

New parents can still get monthly child tax credit payments, but they may need to wait a bit to update their details. 

Sarah Tew/CNET

The expenses of a baby can seem unending for new parents. And in a pandemic, the costs -- and stresses -- can be higher. On top of that, parents have to figure out what the new child tax credit rules mean for them.

In previous years, parents claimed their children on tax returns and received a £2,000 child tax credit as part of their refund. But things are different in 2021: The child tax credit check is now up to £3,600 for eligible children under age 6 and £3,000 for kids between ages 6 and 17.

The other big change is the payment schedule. This year, the IRS is sending advance monthly partial payments to qualifying families (unless you opt out).

It's great news for parents who need the extra money now, but the requirements can be confusing -- especially for those with new babies born this year (and even more so for parents expecting babies in 2022). Parents of 2021 babies must complete one extra step to start getting those advance child tax credit payments this year.  We'll break down eligibility requirements and how to use the IRS web portals to claim your payments.

Read on to understand how the portals work and how you'll use them to claim the credit for babies born or adopted in 2021, or any new dependents who weren't listed on your 2020 return. Plus, here's how to claim an additional credit for child care expenses and what we know about a fourth stimulus check that may be coming. This story has been updated.

How much are child tax credit payments for new parents?

The new child tax credit for 2021 newborns will be capped at £3,600 per eligible child, going down from there as your income goes up.

The IRS uses different AGI phaseout limits (when your income is too high to qualify for the full amount of the credit) for single filers, heads of household and married couples filing jointly. CNET built a calculator for determining your specific payment eligibility, which you should definitely try out, especially if you also have older children (kids 6 and up qualify for less), share custody or don't hold US citizenship.

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How can parents of babies born in 2021 claim the credit?

If your dependents weren't reported to the IRS by this month (or haven't even been born yet), you have two options for receiving subsequent payments. First, you could always wait until you file your return next spring and receive the entire child tax credit in one lump sum, just like how the former version of the credit worked. But if you'd like to receive monthly payments before next year's tax season rolls around, there's another option. 

The IRS has set up two online portals for special cases like this one. The Child Tax Credit Update Portal will allow taxpayers to report any change in status (dependents, income) throughout the year. These families will be able to use the portal in the coming months to make sure their information is correct, including adding any 2021 babies as qualified dependents. 

Because payment eligibility is based on your child's age on Dec.

31, monthly checks will not be prorated. All children (who meet all other qualifications) born on or before Dec.

31, 2021, will receive the full £3,600 tax credit. And parents of twins can get up to £7,200.

The only variation will be in the timing of each check. Let's walk through a few examples:

  • Babies and children born before 2021: You don't have to do anything to receive child tax credit payments (unless you don't usually file taxes at all).
  • Babies born between Jan.

    1-July 31, 2021: If the child was reported to the IRS before the first check was sent in July, checks will follow the usual timeline shown in the chart below. However, the IRS won't include an option to add new dependents in the portal until late summer or early fall.

  • Babies born between July 1-Nov.

    30, 2021: If some payments have already gone out by the time you're able to register or update your information, you'll receive all subsequent monthly payments, with the remainder coming with your tax return next spring.

  • Babies born in December 2021: After the last check is sent, you will no longer need to use the web portals. Instead, you'll receive the full £3,600 amount when you file taxes in 2022 and claim your new dependent there.
  • Babies born in 2022 and beyond: Unless the expanded child tax credit is extended, parents of 2022 babies will not be receiving monthly checks or the full 2021 amount of £3,600. That means a baby born on Dec.

    31 is eligible, while a baby born Jan.

    1, 2022 is not. This is how the child tax credit has worked in the past as well.

When will child tax credit payments come in 2021?

Unlike stimulus checks, the expanded child tax credit will be paid out in two distinct phases. Half your child tax credit total will arrive as monthly checks, which started on July 15 and will continue on the 15th of every month through December (except in August, when checks arrive on the 13th).

The other half will be paid out on your 2021 tax return when you file in 2022.  Anyone who qualifies and filed a 2020 return by this year's May 17 tax deadline will begin receiving monthly checks automatically -- no need to file, claim, request or otherwise hunt down your money, as long as the IRS knows how many dependents you have. 

Child tax credit payment schedule

Monthly Jul 15: First 2021 check 13-Aug 15-Sep 15-Oct 15-Nov Dec 15: Last 2021 check Apr 2022: Second half of payment
Maximum payment per child 5 and younger Maximum payment per child; 6 to 17
£300 £250
£300 £250
£300 £250
£300 £250
£300 £250
£300 £250
£1,800 £1,500

 
If you haven't yet opted out of advance monthly payments, you should have received the first payment on or after July 15. New parents can still opt out before Aug.

2 in order to avoid more monthly payments. If you opt out now, you'll receive the child tax credit money in one lump sum with next year's tax return.

New parents can use the Update Portal to check eligibility and unenroll. 

What else might affect my child tax credit eligibility?

One important caveat is that both you and your child must be US citizens and your child needs a Social Security number. And another: Your child's age group is based on their age on Dec.

31, 2021, so anyone aging into the next payment bracket at any point in 2021 will be considered a part of that group for the entirety of the year. (Got a 5-year-old turning 6 this year? Unfortunately, you may be out about £600.)

We'll keep this story updated as new information emerges about the expanded child tax credit.

Still have unanswered questions?

Here's what to know about 2021 income limits, how shared custody could impact your child tax credit payments and a timeline for monthly payments