The Child Tax Credit expanded temporarily, then returned to its previous amount
Congress did pass an expanded Child Tax Credit, but it was temporary. The American Rescue Plan, signed into law in March 2021, increased the credit from $2,000 per child to $3,600 for children under 6 and $3,000 for children ages 6 to 17. That expansion ended on December 31, 2021. Starting with the 2022 tax year, the credit went back to $2,000 per child, where it remains today.
The 2021 expansion also changed how the credit worked. For most of 2021, families received half the credit as monthly payments directly from the IRS (called advance payments), and claimed the other half when they filed their 2021 tax return. Beginning in 2022, the credit returned to the standard structure: you claim the full amount only when you file your return, with no monthly payments.
If you received advance payments in 2021 and your income changed, or if you had a new child, you may owe money back when you file your 2021 return. The IRS has rules about reconciliation — matching what you received against what you were actually may have access to to receive.
Key Takeaways
- The expanded Child Tax Credit of $3,000 to $3,600 per child was in effect only for 2021 and expired on December 31, 2021.
- The credit returned to $2,000 per child for tax years 2022 and beyond, with no monthly advance payments.
- If you received advance payments in 2021, you must reconcile them on your 2021 tax return by comparing what you got to what you were may have access to to receive.
- Changes in your 2021 income or family size can affect how much of the advance payments you keep and how much you owe back.
How the 2021 expansion worked
In 2021, the IRS sent half of the expanded credit to families as monthly payments from July through December. A family with one child under 6 received $150 per month ($900 total), and a family with one child ages 6 to 17 received $125 per month ($750 total). These payments went out automatically to families who had filed a 2020 tax return or used the IRS's Non-Filer Sign-Up tool.
The other half of the credit was claimed on the 2021 tax return. So a family with one child under 6 would receive $900 in advance payments and then claim another $900 when filing, for a total of $1,800 for that child in 2021.
This structure was different from how the credit normally works. In typical years, you receive the entire credit only when you file your return — there are no monthly payments. The 2021 advance payment system was temporary and tied to the expanded amounts.
What changed in 2022 and beyond
Starting with the 2022 tax year, Congress did not extend the expansion. The credit returned to $2,000 per child, regardless of age. There were no advance monthly payments in 2022, 2023, or 2024. Families claim the full $2,000 per child only when they file their tax return for that year.
The income limits for the credit also returned to their pre-2021 levels. In 2024, the credit begins to phase out at $400,000 of modified adjusted gross income for married couples filing jointly and $200,000 for single filers. These thresholds vary slightly year to year based on inflation adjustments.
Some members of Congress have proposed bills to restore the expanded credit and monthly payments, but as of now, no such legislation has passed. The credit remains at $2,000 per child.
Reconciling advance payments on your 2021 return
If you received advance payments in 2021, you must reconcile them when you file your 2021 tax return. Reconciliation means comparing the total advance payments you received to the total credit you were may have access to to claim for 2021. If you received more than you were may have access to to, you owe the difference back. If you received less, you claim the remaining amount as a credit on your return.
The reconciliation happens on Form 8812, Credits for may have access to Children and Other Dependents, which you attach to your 2021 Form 1040. The form asks for the total advance payments you received (the IRS will have sent you a letter showing this amount) and calculates how much credit you can actually claim based on your 2021 income and dependents.
Your 2021 income is the key factor. If your income was lower in 2021 than when you received the advance payments, you may have been may have access to to more credit than you got, and you will receive a refund. If your income was higher, you may owe money back. If you had a new child in 2021 or a child aged out of the credit range, that also affects the calculation.
Situations that trigger repayment of advance payments
You may owe back some or all of your advance payments if your 2021 income was higher than expected when you received the payments. The credit phases out at higher income levels, so earning more money during the year can reduce the amount of credit you may have access to for.
You may also owe back payments if you received them based on a 2020 tax return but had a significant change in your family in 2021 — such as a child aging out of the credit range, a child no longer living with you, or a new dependent. The credit is based on who you can claim as a dependent on your 2021 return, not on who you claimed in prior years.
If you moved during 2021 and the IRS sent advance payments to an old address, you may not have received all the payments you were may have access to to. In that case, you would claim the missing amount on your 2021 return. The IRS letter showing your advance payments will help you verify what you actually received.
How to find your advance payment amount
The IRS sent Letter 6419 to every household that received advance Child Tax Credit payments in 2021. This letter shows the total amount of advance payments you received. You will need this letter when you file your 2021 tax return.
If you did not receive Letter 6419 and believe you should have, you can contact the IRS at 1-800-829-1040 or check your online IRS account at IRS.gov. You can also use the IRS's Child Tax Credit Update Portal (which was available through 2021) to verify the payments, though that tool is no longer active for new changes.
Keep Letter 6419 with your tax records. Your tax software or tax preparer will ask for the amount shown on this letter when you file your 2021 return. If you cannot find the letter, the IRS can provide a transcript showing the payments.
Frequently Asked Questions
Do I have to pay back all my advance payments if my income was higher in 2021?
Not necessarily. You only owe back the amount by which your advance payments exceeded the credit you actually may have access to for based on your 2021 income. The IRS calculates this on Form 8812. If your income was only slightly higher, you may owe back only part of the payments or nothing at all.
What if I did not receive all the advance payments I was supposed to get?
You claim the missing amount on your 2021 tax return. Letter 6419 shows what the IRS sent you. If that amount is less than what you were may have access to to based on your 2021 income and dependents, Form 8812 will calculate the difference, and you will receive it as a refund or credit against taxes owed.
Can I still claim the $2,000 Child Tax Credit for 2024?
Yes. The $2,000 per child credit is still in effect for 2024. You claim it on your 2024 tax return when you file. There are no advance monthly payments — you receive the entire credit only when you file. Income limits and other rules explore based on your filing status and modified adjusted gross income.
Will Congress bring back the expanded credit and monthly payments?
Congress has not extended the expanded credit or monthly payments beyond 2021. Proposals to restore them have been introduced but have not passed into law. The credit remains at $2,000 per child for now.