Child Tax Credit Sign-Up Tool To Go Mobile Soon

Goal is to ensure low-income families who don’t file taxes don’t miss out

Mother working from home while holding toddler, family in backgroun

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Trying to make sure millions of low-income families who don’t file taxes don’t miss out on the new monthly child tax credit payments, the government said a new user-friendly mobile phone app will soon make it easier to sign up. 

Key Takeaways

  • The government is working with a nonprofit group on a new more user-friendly mobile app enabling families who aren’t automatically getting child tax credit payments to sign up for them with the IRS.
  • The Code For America nonprofit group’s app will launch in the next few weeks, and will be mobile-friendly and have a Spanish-language option—both features the current official sign-up tool lacks.
  • The improved tool is aimed at reaching an estimated 4 million low-income families who typically don’t file taxes, and who would benefit most from getting up to $300 a month per child.

The Treasury Department said Friday a new mobile and multilingual sign-up tool is being created by the nonprofit technology group Code for America to reach people who qualify for the tax credit but aren’t automatically getting it already because the IRS doesn’t have previous tax returns for them. The department also pledged to find funding for a permanent tool.

In the meantime, Code for America developers say its new app—launching through in the coming weeks—will solve many of the shortcomings that make the IRS’s existing non-filers sign-up tool difficult to use. At least 4 million children in low-income families may be eligible for the payments but not receiving them because, among other reasons, their families don’t earn enough to file tax returns, according to a recent estimate by the Center on Budget and Policy Priorities, a think tank that studies poverty.

“With the stimulus payments, and now the child tax credit, one of the biggest barriers for low-income families is that the tax process is too complicated,” said David Newville, senior program director for tax benefits at Code for America, the California-based civic nonprofit group developing the app. “There’s a lot of confusion.”

Getting signed up for this year’s federal tax credit—bigger and available to more low-income families than in the past—is worth up to $300 per child each month for the rest of this year. In a dramatic change authorized by the American Rescue Plan, the IRS is advancing half of the total 2021 tax credit so that families can get some of their money now rather than waiting until tax time next year. 

The payments appear to have already had a noticeable impact on financially struggling households, with the U.S. Census Bureau reporting Thursday that the first payments, sent in July, coincided with a drop in the share of surveyed families who said they faced food shortages. Among households with children who received the credit, the share reporting food insecurity fell to 8.4% from 11%.

So far those who aren’t getting monthly payments automatically have to use the existing IRS tool for non-filers to register, which isn’t designed to work well on mobile devices and relies on users to input things they may not know, according to Code for America. The group says its GetCTC tool won’t require too much information to establish eligibility, will be available in Spanish, and crucially, will work well on mobile devices. Many low-income Americans often access the Internet through mobile phones rather than a computer. 

The Code for America app will also allow users to claim the three stimulus payments that the government distributed during the pandemic, if they haven’t already gotten them. It will also directly interface with the IRS computer system, much like TurboTax or other tax preparation software does, Newville said. 

The second monthly child tax credit payment, which went out on Friday, reached 36 million households with nearly 61 million children, the Treasury Department said. That’s 856,000 more households and 1.6 million more children than the first payment on July 15. More people got the second round of payments because the IRS has processed more tax returns and more people have used the non-filers sign-up tool, a Treasury Department official said.

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