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Treasury Offset Program

Frequently Asked Questions on the Treasury Offset Program (TOP), IRS 2021 Child Tax Credit, Economic Impact Payments, and the Recovery Rebate Credit

Treasury Offset Program (TOP) and the IRS 2021 Child Tax Credit

IRS 2021 Child Tax Credit and Advanced Child Tax Credit Payments

Advance Child Tax Credit payments are early payments from the Internal Revenue Service (IRS) of 50 percent of the estimated amount of the Child Tax Credit that a taxpayer may claim on a 2021 tax return during the 2022 tax filing season. In some cases, these monthly payments will be made beginning July 15, 2021 and through December 2021.

The Advanced Child Tax Credit payments, authorized by the American Rescue Plan Act, are not subject to offset for any reason through the Treasury Offset Program (TOP).

IRS has prepared frequently asked questions (FAQs) to address debtor inquiries regarding this topic. These are available online at https://www.irs.gov/credits-deductions/2021-child-tax-credit-and-advance-child-tax-credit-payments-topic-g-receiving-advance-child-tax-credit-payments.

No. Advance Child Tax Credit payments will not be reduced (that is, offset) for overdue taxes from previous years or other federal or state debts that you owe.

However, if you receive a refund when you file your 2021 tax return, any remaining Child Tax Credit amounts included in your refund may be subject to offset for tax debts or other federal or state debts you owe.

Economic Impact Payments under the American Rescue Plan Act of 2021:

The 3rd Economic Impact Payment was authorized by the American Rescue Plan Act of 2021, which was signed into law on March 11, 2021.

The Recovery Rebate Credit

The Recovery Rebate Credit is authorized by the Coronavirus Aid, Relief, and Economic Security (CARES) Act, signed into law on March 27, 2020, and the COVID-related Tax Relief Act, signed into law on December 27, 2020. The Recovery Rebate Credit was eligible to be paid as rounds of advance payments during 2020 and 2021. These advanced payments of the Recovery Rebate Credit are referred to as Economic Impact Payments.

TOP, which collects delinquent federal and state debts, has prepared the following frequently asked questions (FAQs) to address debtor inquiries regarding whether and to what extent the advance payments of the Recovery Rebate Credit (i.e., the Economic Impact Payments) can be offset.

Economic Impact Payments under the Coronavirus Response and Relief Supplemental Appropriations Act of 2021:

Economic Impact Payments under the CARES Act:

Recovery Rebate Credits under the Coronavirus Response and Relief Supplemental Appropriations Act of 2021 and the CARES Act:

Other Questions

Last modified 07/09/21