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Child Tax Credit Payment: Some Parents to Receive Paper Checks Instead of Direct Deposit Payments

·4 min read
picture of Uncle Sam's arm sticking out of a mailbox and holding cash
picture of Uncle Sam's arm sticking out of a mailbox and holding cash Getty Images

The IRS is sending the second batch of monthly child tax credit payments today. Payments sent in August will total about $15 billion and will be delivered to approximately 36 million families across the country. Generally, depending on your income, your monthly payment can be as much as $300-per-child for kids under age 6 and $250-per-child for kids 6 to 17 years of age.

(Note that families who didn't get a July payment and are getting their first monthly payment in August will still receive their total advance payment for the year. As a result, the total payment will be spread over five months, rather than six, making each monthly payment larger. For these families, each payment is up to $360-per-child for kids under age 6 and up to $300-per-child for kids ages 6 through 17.)

Most of the child tax credit payments are made by direct deposit. That was the case for the first round of payments in July, and for the second round of payments sent on August 13. However, just because you received your July payment by direct deposit doesn't necessarily mean that your August payment will automatically be deposited into your bank account. According to the IRS, some families who received direct deposits in July will receive the August payments by paper check delivered through the mail. This is due to an unspecified issue that the IRS expects to be resolved before the September 15 payments are sent. The IRS says that the issue affects less than 15% of the people who received payments by direct deposit in July.

You can check the IRS's Child Tax Credit Update Portal to see if you're scheduled to receiving a direct deposit or paper check this month. If you're one of the 15% who received a direct deposit payment in July but a paper check in August, the IRS says you don't have to take any additional action for your September payment to be issued by direct deposit.

Who Should Receive Child Tax Credit Payments by Direct Deposit?

You're supposed to receive your monthly child tax credit payments via direct deposit if the IRS has your bank account information from:

  • Your 2019 or 2020 tax return;

  • The IRS's online tool used in 2020 by people who aren't required to file a tax return to get a first-round stimulus check; or

  • A federal agency that provides you benefits, such as the Social Security Administration, Department of Veterans Affairs, or the Railroad Retirement Board.

You'll get a paper check or debit card in the mail if the IRS doesn't have your bank account information.

If you want to revise the bank account information the IRS has on file, go to Child Tax Credit Update Portal to make the change. (Note that monthly payments can't be split between multiple accounts – the entire payment must go into one bank account.) The online tool will tell you if you're scheduled to receive monthly payments by direct deposit. If so, it will list the bank routing number and the last four digits of your account number. If you don't change it, this is the account that will receive all future monthly payments.

Parents who are currently scheduled to receive payments by mail can also sign up for direct deposit using the online tool. Just enter your bank routing number and account number and indicate whether it's for a savings or checking account. However, to get your September payment by direct deposit, you need to act by August 30. You'll get paid much faster if you switch to direct deposit, plus you won't have to worry about a paper check or debit card getting lost or stolen.

Split Child Tax Credit Payments for Parents with ITINs

The IRS also reported that it's correcting an issue regarding the monthly child tax credit payments for families where the parent(s) have an Individual Taxpayer Identification Number (ITIN) and their children have a Social Security number. Families in this situation who didn't receive a July payment are receiving a monthly payment in August, which also includes a portion of the July payment. They will receive the remainder of the July payment in late August.

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