CENTRAL TEXAS — The Internal Revenue Service (IRS) is starting to send out money for the Child Tax Credit.
As the first checks are in the mail, the number one question is how much money should parents expect to get?
The American Rescue Plan increases the Child Tax Credit for dependents under the age of 16 from $2,000 to $3,000. It then jumps to $3,600 for children under 6-years old.
"Basically, what the law has done here is directing the IRS to send out half of the credit amount in what we're calling advanced monthly payments," IRS spokesperson Clay Sanford tells 25 News.
That could be $250 to $350 per month depending on the child's age.
Taxpayers can also choose the lump sum when they file. But the Child Tax Credit won't be free money for everybody, you could end up being taxed for it.
"If you made more money in 2020 it's possible that it might," Sanford explained. "It's based on the latest return that we have for you. It is subject to recapture yes."
The IRS is also sounding a scam alert.
"We're always seeing scams circulating on this one. So, it seems like every time there's a credit or deduction everybody jumps on the scam bandwagon," Sanford said.
They're warning people to not click on any unsolicited emails because they are most likely a scam.
If you are not sure if you qualify for the Child Tax Credit, you can sign up for it online at IRS.gov.
Just like any other deduction, you can request the Child Tax Credit when you file your taxes.