Back Off, IRS! - Accounts Holding Advance Child Tax Credit Payments Immune From Levy?

By now, many eligible taxpayers may have found a deposit appear in their bank account during July. This was likely in addition to one or more correspondence letters from the Internal Revenue Service and/or the White House (which may or may not have given some taxpayers a heart attack, thinking the IRS letter was a potential income tax audit). That initial deposit and related communications were the beginning of advance Child Tax Credit payments. Eligible taxpayers will receive periodic payments between July and December 2021 in advance of the 2021 Child Tax Credit claimed on their 2021 personal income tax returns. Some taxpayers are not thrilled about the advance deposits (to the extent they have received them); however, according to a recent memorandum issued by the Internal Revenue Service, such funds may be subject to levy protection.

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