Direct deposit of Child Tax Credit has begun

The IRS and the Treasury announced yesterday that millions of American families have started receiving monthly Child Tax Credit payments as direct deposits begin posting in bank accounts and checks arrive in mailboxes.

This first batch of advance monthly payments worth roughly $15 billion reached about 35 million families yesterday across the country. About 86% were sent by direct deposit.

The payments will continue each month. The IRS urged people who normally aren't required to file a tax return to explore the tools available on IRS.gov. These tools can help determine eligibility for the advance Child Tax Credit or help people file a simplified tax return to sign up for these payments as well as Economic Impact Payments, and other credits they may be eligible to receive.

Under the American Rescue Plan, each payment is up to $300 per month for each child under age 6 and up to $250 per month for each child ages 6 through 17. Normally, anyone who receives a payment this month will also receive a payment each month for the rest of 2021 unless they unenroll. Besides the July 15 payment, payment dates are: August 13, September 15, October 15, November 15 and December 15.

[Editor's note: Bankers should remember that Treasury regulations require that direct deposits that are not posted because the designated account has been closed must be returned "account closed." Treasury will re-send these payments in check form. The IRS has a Child Tax Credit Update Portal that can be used by families to check on their enrollment to receive the advance payments, unenroll to stop getting advance payments, and provide or update their bank account information for monthly payments starting with the August 13 payment.]