The third Child Tax Credit advance payment is slated to arrive on Wednesday, September 15. The last day to reliably un-enroll from that payment was on Monday, August 30; while parents may still un-enroll, doing so will not take effect until the October check arrives on Friday, October 15.
The checks are arriving by default. Unenrolling from them, in order to claim the entire benefit at the end of the fiscal year in April 2022, has always been possible, but it has been an opt-out rather than an opt-in decision. On the face of it, if the money is going to a family either way, it makes little sense to delay receiving it for seven to eight months.
On the other hand, however, there are a few compelling reasons that one might seek to unenroll from the advance payments. Most of these reasons involve a change of circumstance. If a person knows something about their income that the IRS does not and that something could change the status of their Child Tax Credit payments, it might be more convenient to simply opt out as early as possible.
The main reason that one would decide to opt out involves one’s income. The Child Tax Credit is only payable in full to individuals making $75,000 or less per year, or to parents filing jointly making $150,000 or less per year. If a person’s income rose sharply from 2020 to 2021—a distinct possibility, given the unusual circumstances of the pandemic—it is possible that they will not actually qualify for the Child Tax Credit in 2021, but the IRS does not know yet.
This is a problem because when the IRS finds out, it will want its money back. Surprise bills during tax season are already unpleasant; to save time and trouble, many Americans will find it convenient to simply forego the advance checks, rather than accepting them and having to pay them back later.
Other reasons are more mundane; some people will simply want to receive a larger one-time payout in April and are willing to wait for the money until then. Either way, the total amount of money is the same, though, so there is nothing gained or lost by delaying.
Trevor Filseth is a current and foreign affairs writer for the National Interest.