More than 30 million U.S. families will be eligible to receive an Advance Child Tax Credit with the first round of six monthly payments starting July 15.
The early credit is part of President Joe Biden’s $1.9 trillion American Rescue Plan that was signed into law in March.
The IRS payments will be automatically made for households where the parents file joint tax returns and may receive up to $300 per child under 6 years old, and $250 for each child from ages 6 to 17.
This first half of the total credits will come in the form of these monthly payments, with the other half coming after the families file their 2021 taxes. In total, children under 6 will be eligible to receive up to $3,600, while children ages 6 to 17 may receive up to $3,000.
“The IRS will pay half the total credit amount in advance monthly payments beginning July 15,” The IRS explains on its website. “You will claim the other half when you file your 2021 income tax return.”
The credit covers more than 88% of the children in the U.S., according to a report by the Associated Press and an estimated 65 million children will qualify for the benefit.
There is also no limit for children who qualify per family.
After this week’s payments are distributed, the following credits will be given out on August 13, September 15, October 15, November 15 and December 15.
To qualify, those joint returns must have been filed in either the 2019 or 2020 tax season, the parents must have lived in the U.S. for more than half the year and have a child under the age of 18 with a valid Social Security number.
There are also income limits and the benefits reduce when a parent earns more than $75,000 of annual income, or the couple makes a combined $150,000.