Eligible families will get $300 a month for each child under six and $250 for each child older than that, but any money excess money might have to be paid back.
Starting Thursday, more than 1.2 million families in Ohio will get monthly checks until the end of 2021 as part of President Joe Biden’s Child Tax Credit initiative.
This money is not coming out of thin air, though.
The child tax credit is monthly payments that are essentially just an advance on the tax credits typically applied at the end of the tax year.
These monthly payments will replace the annual credit that would otherwise be claimed at the start of 2022.
Families get $3,600 annually for children under age 6 and $3,000 for children ages 6 to 17, but six months of payments will be advanced monthly through the end of 2021.
Eligible families will get $300 a month for each child under 6 years old and $250 for each child between 6 and 17 years old.
This is money mother of eight, Michelle Oetjens is happy to get.
“Money given to us by the government is a blessing for anyone who has kids. I know a lot more moms would want to work if they had some extra help with childcare expenses,” she said.
However, this is not necessarily an economic impact payment, and excess money families could get might have to be paid back.
“Those payments are based on either your 2019 or 2020 tax return, but your eligibility for the credit is based on 2021,” said Lisa Wood, a partner with Whalen & Co. CPAs.
“So for instance, if you’re not eligible for the full credit, but they pay you the full credit amount when you do your full tax return next year, you’ll do a reconciliation, and you’ll have to pay some of it back.”
Eligible people who have filed their taxes already should get payments deposited into their accounts on the 15th of each month.
“If you do get advanced payments, it’s very very important to keep track of what you receive. That reconciliation can get difficult if people don’t keep track or don’t remember what payments they got every month,” Wood said.
Parents don’t have to get the child tax credit if they do not want it.
It is too late to opt-out of the July payment, but families can opt out of the monthly payments for the rest of the year on the IRS’ website.