The American Rescue Plan Act (ARPA) expanded the Child Tax Credit for tax year 2021 only, allowing families to receive advance payments instead of taking the full credit on their 2021 tax return. The goal of increasing the credit, along with monthly payments, is to help families that have struggled during the COVID-19 pandemic and lessen child poverty in the U.S.
Beginning July 15, the IRS will start issuing monthly advance payments to families based on their 2020 or 2019 tax return.
