There’s now a way to unenroll from the Advance Child Tax Credit Payments (linked from the official site here).
The good: can use an existing IRS username or ID[.]me (?) account. If you do not have an account and do not want to use ID(.)me, you can sign up another way by using another IRS application, such as View Your Tax Account or Get An Identity Protection PIN.
The bad: “If your most recently filed tax return was a joint tax return, your spouse will also need to unenroll, if appropriate. Unenrolling is an individual action. If your spouse does not unenroll, they will receive payments for their portion of the advance Child Tax Credit.”
I don’t get it. If we filed a joint return, why is this an individual action? It’s MY frigging checking account you’ll be depositing my spouses’ “portion.” And that’s only if you process my paper return in time and send a DD and not another debit card… Ugh.
That makes it twice the hassle for nothing and makes the decision to advance these credits at a time of rising inflation, a very poor decision. Should have been an opt-in option only. Not another tax compliance burden.
The entire Jan bill was full of poor decisions. There’ll likely be lost checks, cards, and money with this.
Even if they wanted to dole out funds, should’ve just made it a tax credit as usual. Decrease withholdings and you’re all set. This entire advance thing is utterly pointless.
There might be legal requirements for both people to make such a change for taxes. I mean its the tax form for 2 people officially and so 2 people should be signing on it.
I’m assuming the vast majority of pepole will take their monthy money and use it to subsidize their normal spending. I think it works better this way versus giving all the money at once with the tax refund. When households get big piles at oncce they’re more likey to blow it on more exorbitant spending. (my perception / opinion) I’d think it better to spend it on normal bills routinely.
The problem with this logic is that people get used to it, and then all of a sudden it stops and they have to wait 15 months for it again.
Since the vast majority of people were either not negatively affected financially by the COVID shutdown, or if they were, they are back to normal employment now, this should absolutely be an OPT-IN program, not an OPT-OUT. Yes, the vast majority of people will take the monthly payment, but that’s mostly because it is the default. The question should be, how many people actually want their taxes majorly disrupted for 1 year just to get a portion of their refund early? Or worse, how many people want to get money now and pay it back on April 15 because they already had their withholdings setup so that they didn’t get a big refund? I don’t think anyone employed wants to be in that second category.
I will be sending an email to my clients this week reminding them if they don’t want any surprises next year, they need to opt out.
Wouldn’t decreasing withholdings achieve the same thing, with less fuss? Quite sure the incident of paychecks going to the wrong person or stolen is much less than unexpected mailings and deposits.
Anyone who did not have an account previously and wanted to opt out of the child tax credit payments experience ID verification requiring you to provide a selfie for facial recognition purposes? Was this the only way for those who did not have an existing account?
I just noticed that the IRS were using ID.me for this. Announcement link Nothing to be concerned about with IRS requiring facial recognition so that they don’t send you money you don’t want… probably.
In theory, it’d make sense. That’s the very reason many of us adjust withholding to not give the IRS a free loan.
But that argument loses a bit of steam with the limited options to use the float mentioned. $300/month per kid at current liquid rates may not be worth the hassle of re-adjusting your withholding to account for it. 2 kid scenario invested at 0.5% APY works out to be an extra $8 interest after tax over 9 months.
That is annoying. However, if you try to sign up for another IRS application such as View Your Tax Account or Get An Identity Protection PIN, they do not require the use of ID(.)me to sign up. You should then be able to use the same username for the Child Tax Credit opt out.
You can’t adjust withholdings if you don’t work. The biggest part of this tax credit is that it is fully refundable even if you have no income or no taxes. Right or wrong, these are the people these monthly payments were most targeted for. As you said, people with tax withholdings can make their own advance tax credit at any time.
If you want to play the bailout odds, go ahead and take the full advance payment. Then when everyone cries next March/April that they have to pay a big tax bill now, I could see them doing something to “cushion the stupid”. See how they handled taxes on unemployment last year for an example of this.