Child Tax Credit & Stimulus Check Update: IRS Says Some of You Ows $3,600 Payments Issued By Them

The payments for the child tax credit advance are due in a few weeks. The opportunity to opt out of the November payment is closing. Between July and December, the IRS will pay out $1,800 in total payments, with another $1,800 available when taxpayers submit 2021 income tax returns.

Angelina Marques is a resident of Toledo, Ohio, who says receiving stimulus payments was easy. The process of collecting early child tax credit payments was even easier.

But what happens if the IRS says you owe child tax credit money?

Marques made sure that her family was enrolled, updated their personal information, and waited for the money. Each month, payments arrived.

“It was a significant amount of money for me,” she says. “I had to pay $600 each time for both my children. It went well. The IRS was fine. Then I got an email followed by a letter.

She ignored the email since she thought it was a scam. Marques isn’t sure whether the email was genuine or not, but it described a scenario in which she would have to return her child tax credit in the spring. The Marques family’s combined income falls well below the $30,000 limit for qualifying for the child tax credit.

Marques went on to say, “Then we got a letter in the mail stating that there was an issue with our tax return last year.” She sent that correspondence about her tax refund, which had been paid out without difficulty. The IRS informed her that she owed a large portion of her payback due to a computer snafu.

“We don’t have any more cash,” she explained. “It’s vanished. And we didn’t even know what the problem was. They just handed us an ultimatum, telling us to pay back $3,600 or face fines and ramifications.

After consulting with her tax advisor, they decided to wait it out. “We have children and other obligations, which means we don’t have a lot of cash sitting around waiting to be returned to the government because they claim an error was made,” said one homeowner.

Worse, the letter stated that there was no way for the family to appeal. Their tax professional advised them that paying back what the IRS said they owed first, followed by reclaiming it on their next year’s taxes was the best method to handle the situation. “But we can’t do that because we don’t have the funds,” Marques added.

What should you do if the IRS comes after your child tax credit or tax refund?

If the IRS sends you a notice claiming that your taxes were audited owing to a math mistake, or audit notice  – pay it back, this is the best option. The agency is working its way through a backlog of millions of tax returns as it attempts to catch up on a historic delay.

The fines and costs involved with disregarding a violation notice maybe thousands of dollars. Worse, an appeal is not possible after notice is ignored.

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