Newborn in 2021

[craftercool 7]

Hi there!

Quick question, my wife is expected to go into labor on early August and with all these new advance child credits that the IRS will be giving away I was wondering if I should do something right after my child is born, how should I inform the IRS? Also, would you recommend that I update my W4 with my employer as soon as he's born?

 

Thanks in advance for any help on this matter. 

 

Best regards!

[Wuozopo 4,293]

5 minutes ago, craftercool said:

Also, would you recommend that I update my W4 with my employer as soon as he's born?

That’s just an estimate kinda thing to help payroll adjust how much to hold out of your check. If you update it with a new dependent, you should get more in the paycheck and less held out. It’s not a mandatory must do ASAP  thing.  You won’t get in trouble if you don’t to it. 
 

 

[HRQX 4,145]

32 minutes ago, craftercool said:

how should I inform the IRS?

There is an online portal: https://www.irs.gov/credits-deductions/child-tax-credit-update-portal

 

In late summer you'll be able to add dependents through the above portal: https://www.irs.gov/credits-deductions/2021-child-tax-credit-and-advance-child-tax-credit-payments-topic-a-general-information#a16#a16

[craftercool 7]

5 minutes ago, HRQX said:

There is an online portal

Awesome! Thank you very much 🙏

[nastra30 2,287]

1 hour ago, craftercool said:

Awesome! Thank you very much 🙏

If you want the monthly payments from IRS you can add them to the portal. Otherwise, you could also just claim the full child credit when you file you 2021 taxes next year.

[craftercool 7]

3 minutes ago, nastra30 said:

If you want the monthly payments from IRS you can add them to the portal. Otherwise, you could also just claim the full child credit when you file you 2021 taxes next year.

Hi nastra30,  if I decide to claim it next year, would it only be applicable from the birth's month till the end of the year? 

[HRQX 4,145]

5 minutes ago, craftercool said:

Hi nastra30,  if I decide to claim it next year, would it only be applicable from the birth's month till the end of the year? 

Full year either way; i.e. if you don't get the full advance amount for whatever reason then you'll still claim the remaining amounts when doing 2021 taxes. https://apps.irs.gov/app/vita/content/globalmedia/4491_dependency_exemptions.pdf Page 4: "A child who was born (or died) during the year is treated as having lived with the taxpayer for more than half of the year, if the taxpayer’s home was the child’s home for more than one-half of the portion of the taxable year during which the individual was alive."

[nastra30 2,287]

1 hour ago, craftercool said:

Hi nastra30,  if I decide to claim it next year, would it only be applicable from the birth's month till the end of the year? 

No. You'll get 100% full amount if you meet the threshold to qualify for the full amount; It doesn't matter if you start claiming it this year or next year. For tax purposes newborns are considered having lived with you for more than half of the year. See link@HRQXshared above.

Edited July 9, 2021 by nastra30

[craftercool 7]

8 minutes ago, nastra30 said:

For tax purposes newborns are considered having lived with you for more than half of the year.

 

1 hour ago, HRQX said:

"A child who was born (or died) during the year is treated as having lived with the taxpayer for more than half of the year"

 

Appreciate both answers, it seems I won´t qualify for the 100% of the credit since my son will be born in August, that´s less than half of the year. Hopefully I´ll still be able to get at least a part of it. 

[nastra30 2,287]

11 minutes ago, craftercool said:

 

 

Appreciate both answers, it seems I won´t qualify for the 100% of the credit since my son will be born in August, that´s less than half of the year. Hopefully I´ll still be able to get at least a part of it. 

No. You qualify for 100% full credit amount. It doesn't matter what month your child was born or will born in 2021. By default, newborns are considered having lived with you for more than half of the year. In fact, even if they were to be born on December 31st, 2021 @ 11:59pm, you'll get the full amount for the newborn if you are within the required income threshold.

Edited July 9, 2021 by nastra30

[Nitas_man 3,100]

11 hours ago, craftercool said:

 

 

Appreciate both answers, it seems I won´t qualify for the 100% of the credit since my son will be born in August, that´s less than half of the year. Hopefully I´ll still be able to get at least a part of it. 

You qualify for the child tax credit if your child is born in December dude