Last week, the Internal Revenue Service (IRS) sent out the second round of Child Tax Credit (CTC) payments. The payments were slated to go out on Friday, August 13; most recipients received them within days via direct deposit, although the agency has also sent out paper checks, which have mostly not arrived yet.
Unfortunately, for some families, the first round of checks—sent out on July 15—still have not arrived, more than a month later.
In the spring of 2021, the IRS sent out letters in advance of the payments, telling households that they were eligible for the credit and how much they would likely receive. However, some families received the letters, but not the checks in July.
This problem has been particularly prevalent for taxpayers with “Individual Taxpayer Identification Numbers,” or ITIN numbers, many of whom have reported delays in receiving their first payments. ITIN numbers are tax numbers set aside for people who do not have Social Security numbers, usually non-U.S. citizens. While children with ITIN numbers cannot be counted as eligible for the CTC, parents with ITIN numbers of children with Social Security numbers will receive the payments—at least in theory.
The IRS told a local news station that it was aware of a problem affecting payments to families with ITIN numbers, and it was working on resolving the issue.
In previous years, taxpayers have been able to discount the Child Tax Credit—an annual $2,000 per child per year until March 2021—when they file their taxes on or before April 15. However, as part of the American Rescue Plan Act of March 2021, the payments were increased to $3,000 per child per year for children aged six and older, and $3,600 for children under six. Half of these payments will be sent out in advance, in a series of six checks—the first and second of which were sent out on July 15 and August 13, and the next of which will be mailed on September 15. This amounts to monthly payments of $300 for younger children and $250 for older ones in each check.
An estimated thirty-six million families will benefit from the payments, and the positive impacts are said to be enormous. According to the Brookings Institution, the payments will halve child poverty, prompting calls to make them permanent. However, there has also been criticism of the payments from fiscal conservatives, who have especially objected to the March 2021 provision making the checks fully refundable—transforming them from tax breaks, which require a person to pay taxes to benefit from, to cash payments not unlike the stimulus checks sent out in 2020 and 2021.
Trevor Filseth is a current and foreign affairs writer for the National Interest.