(CNN)The families of more than 65 million children will start receiving enhanced child tax credit monthly payments of up to $300 on July 15, the Biden administration announced Monday.
The temporary benefit, which will be sent to 39 million households and covers 88% of children in the US, stems from the Democrats’ $1.9 trillion coronavirus rescue package. The vast majority of families will receive the funds via direct deposit, while the rest will get checks or debit cards in the mail.
The Internal Revenue Service will send the payments on the 15th of the month, unless it falls on a holiday or weekend, through December. Eligible parents will receive $300 a month for each child under age 6 and $250 for each one ages 6 to 17.
Payments will be based on taxpayers’ 2020 tax returns or their 2019 returns if the 2020 returns are not filed and processed yet.
To reach low-income households that don’t typically file taxes, the agency is setting up a portal to allow them to submit their information. This will allow them to claim both the enhanced child tax credit and stimulus payments they might have missed. A similar online form existed last year to allow low-income Americans to receive the first round of stimulus checks from the March 2020 relief package.
Meanwhile, the IRS will also launch a separate portal to allow parents to update their address, bank account information and family size, as well as opt out of the monthly payments in favor of receiving the tax credit as a lump sum next year when they file their return. If a family’s situation changes during the year, the IRS can adjust the payment when they file their 2021 tax return to claim the second half of the credit. Lower income taxpayers will not be required to return any overpayments, a senior administration official said.