WEST DES MOINES, Iowa — The first rounds of advance child tax credit payments were sent out July 15, but some parents are having a hard time understanding them.
The American Rescue Plan increases the amount of the child tax credit this year. It also gives parents the ability to receive up to half of the money in advance, in the form of monthly payments, instead of all at once when they file their tax returns.
Parents have posted about many problems in the "Child Tax Credit Payments Info" Facebook group. Among those—problems verifying ID.
"The issue is in terms of them identifying who you are," said Cameron McCarty, president of Vivid Tax Advisory Services. "You have an opportunity there where you can upload or scan your passport, you can do your driver's license."
McCarty recommended contacting the IRS to resolve these issues, but he said to be patient—it can be time consuming.
With the Advance Child Tax Credit, parents can get $3,600 ($300 per month) for each child under 6, and $3,000 ($250 per month) for each child between 6 and 17.
However, McCarty said parents aren't understanding how opting out of the advance credit works.
"It's important to understand that you are not opting out of the benefit, you are just saying 'I don't want my monthly income I want all that money during tax season on my tax returns,'" McCarty said.
McCarty also said anyone who receives money for the tax credit but doesn't actually qualify for it will have to pay it back. So, he suggests not spending it.
Rep. Cindy Axne shares the benefits of the monthly child tax care credit payments