Families who received the advance child tax credit need to file a 2021 income tax return to collect any extra money that's owed.
What many families might not realize is that the monthly payments last year were designed to represent only half of a family's estimated total credit.
The letter, according to the IRS, will include the total dollar amount of the monthly advance child tax credit payments that you received in 2021. The letter also will list the number of qualifying children used to calculate the advance payments.
If a baby was born in 2021 or the family adopted a child in 2021, the child would not have received any advance payments and those payments would be claimed on the 2021 tax return.
If you received money from July through December last year for the child tax credit, you're going to need to compare the payments that you received with what you'd actually be qualified to get based on your 2021 income and family situation.
The IRS notes that the letter contains important information that can make preparing their tax returns easier.
Also, families who received the advance child tax credit payments can check the amount of their payments by using the child tax credit update portal at IRS.gov.
Mark Luscombe, principal analyst for Wolters Kluwer Tax & Accounting, said the taxpayer can check the information on the IRS.gov site for what the IRS says was paid in 2021.
You can compare what you received by looking at your bank statements. Child tax credit payments were made around the 15th of each month last year from July through December.
Possible reasons for differences, Luscombe said, might involve a situation where advance payments ended up going to a different bank account or a check was lost in the mail.