2022 Tax Refund: How Child Tax Credit Affects Ohio Parents

OHIO — Tax deadlines are rapidly approaching and Ohioans who received advance child tax credit payments made during the 2021 tax year could be in for a big surprise.

Tax Day this year is Monday, April 18, for most Americans. It’s usually on April 15, unless that falls on a weekend or a holiday. And while April 15 isn’t on a weekend, it’s a legal holiday in the District of Columbia — Emancipation Day, which commemorates the end of slavery in Washington, D.C. (it’s officially April 16 but is observed on the weekday nearest that date).

But residents of Massachusetts and Maine get an extra day to file their taxes. That’s because both states observe Patriots’ Day, commemorating Revolutionary War battles, which falls on April 18.

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The main thing parents need to know is how the advance tax credits — in effect, an advance on their refunds — apply to their individual situations. In many cases, refunds will be smaller. In some cases, parents could have to return some of the money to the Treasury.

“One thing that likely will happen is that people will get smaller refunds than they were expecting because that refund, in a sense, came in advance,” Barbara Weltman, an editor of “J.K. Lasser’s Your Income Tax 2022,” told CNN.

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The coronavirus relief benefit for parents has complicated the tax season in other ways, too, including for millions of Americans who’ve never had to file an income tax return because they didn’t make enough money.

The tax credits, part of President Joe Biden’s $1.9 trillion coronavirus relief program, increased payments to up to $3,600 annually for each child age 5 or younger, and $3,000 for those 6-17. Monthly, that’s between $250 and $300 per child.

The government began depositing the monthly tax credit payments — overall, $93 billion — in Americans’ bank accounts in July. Six months worth of payments have yet to be claimed, and some families haven’t collected any of the credits they’re due. In all, about $193 billion in benefits remain unclaimed.

So, what does that mean to you? Here are seven things to know:

1. Who’s Eligible?

Families whose adjusted gross income was at $150,000 or below for married couples (or $75,000 for single-filer parents) are eligible for the credit.

2. You Must File A Tax Return

To get all or the rest of the money due from the tax credit, parents need to file an income tax return — even if they’ve never done so before or don’t owe any taxes.

That means families who didn’t receive any of the advance tax credit payments during 2021 can claim the full amount of the credit on their tax returns. Those who received the payment from July-December must file a tax return to get the credit for the first six months of 2021.

Again, that’s regardless of the family’s tax filing history.

3. Divorced? It’s Complicated.

Divorced parents who share custody of their children often switch who claims the child tax credit each year when they file their returns. Because the tax credit payments were based on 2020 tax returns, they may or may not have gone to the parent with physical custody in 2021.

A parent who did not have physical custody in 2021, but who received the tax credit payments, could have to pay back at least part of that money, Weltman told CNN.

4. Changes In Income Change Things

Here’s another scenario that could complicate tax returns. Many families saw their income plummet during the pandemic but rebound as their jobs returned, and they may have received more than they should have in child tax credits.

They may have to pay some of that money back.

5. The IRS Letter May Be Incorrect

Families who received payments should have received a notice — “Letter 6419, 2021 advance CTC” — letting them know for tax filing purposes how much they’ve been paid. Some of those forms may include incorrect information.

Other families may be unsure if they received paper checks that haven’t been cashed.

In either case, families should go to the government’s Child Tax Credit Update Portal to see how much of the credit money they should have received.

And despite any inconsistencies in the letter, the IRS says to keep it — and any other letters or documents about advance payments — with tax records.

6. File Your Taxes Electronically

For folks who aren’t familiar with the process, file returns electronically if at all possible — and as far ahead of the April 18 tax deadline as possible — to get refunds more quickly.

7. Where To Find More Answers

Start at ChildTaxCredit.gov, an IRS website that lays out the criteria filers must meet to claim the target.

Also, IRS volunteers will offer walk-in assistance with IRS volunteers in 35 locations for people who need help filing their taxes. Hours are 9 a.m. to 4 p.m. on the second Saturday of each month through April 18, the tax filing deadline.

More advice on filing can be found on sites such as GetYourRefund.org, operated by IRS-certified Volunteer Income Tax Assistance to help families earning less than about $66,000 a year file their taxes for free. Volunteers provide help in both English and Spanish.

Other helpful sites are MyFreeTaxes.com, a United Way-supported site that provides virtual assistance to people who make $58,000 or less to file their federal and state taxes for free, and many other free file sites curated with an IRS tool.

The Associated Press contributed reporting.