Child Poverty

The Biden Administration’s Simplified Filing Tool Will Boost Participation in the Expanded CTC…If It’s Built Well

May 20, 2021 | National

Last week, the Automatic Benefit for Children (ABC) Coalition, co-chaired by CDF and the Center for the Study of Social Policy (CSSP), sent a letter to the Treasury Department and the IRS calling on them to create a simple tool for families with low incomes that have not recently filed taxes to access the expanded Child Tax Credit (CTC) and receive monthly payments, which will begin on July 15 as announced this week.

This week, we heard some great news from the Biden Administration: The IRS will release a simplified filing tool! This tool will help many of the millions of newly eligible families who are not required to file a full tax return to receive the CTC and the third Economic Impact Payment (EIP) – critical benefits to which they are entitled.

What the Simplified Filing Tool Will Look Like 

According to a recent IRS revenue procedure document, the portal will:

  • Likely go online in June;
  • Allow non-filers to claim both the CTC and the third stimulus payment;
  • Not require users to verify their income to determine eligibility; and
  • Be separate from the online portal required in the American Rescue Plan that will allow taxpayers to notify the IRS of any changes in their life circumstances that could affect their eligibility for the CTC. 

Even better, families who used the non-filers portal last year to claim the first two EIPs will automatically get the CTC starting July 15. This important announcement by the administration will significantly improve access to the CTC and help families who do not have the basic support they need to file their taxes. 

Last year the IRS implemented a simplified filing tool (known as a “non-filers” portal) to help households sign up to receive stimulus checks and several million people used that tool. Though helpful, that filing tool was far from perfect. The White House estimated in January that 8 million people, disproportionately people of color, still did not receive the stimulus checks they were eligible for. Many families had difficulty using the simplified filing tool and found the documentation and verification requirements onerous and confusing. In order for the CTC to reach all families who are eligible, the IRS must build on the lessons of last year’s portal and create a tool that is accessible, easy-to-use, and widely advertised to ensure families receive their benefits.

In particular, the IRS must ensure that the simplified filing tool is: 

  • User-friendly. The online tool should clearly note, up front, what information users will need to provide. Supporting documentation requirements should be kept to a minimum. Once complete, the tool should allow users to check on the status of their CTC payments, including when and how the payment was issued and the anticipated date of receipt or—if the filing is rejected—the reason for rejection.
  • Accessible. The tool should be accessible through a desktop or mobile device. It should be available to users in multiple languages and should be accessible to people with disabilities, including those who use screen readers. The tool should also allow applications to be completed by a trusted family member, friend, or anyone else with the authority to complete it on behalf of the user. A separate signature line should be included to document that someone other than the main user has completed the application.
  • Clear and succinct. Instructions should be provided in plain language to avoid confusion, delays, and errors. The tools should clearly display CTC eligibility information, a checklist of documents the user will need, relevant definitions, and guidance on when they can expect to begin receiving payments. For example, the choice of whether to opt out of periodic payments should make clear that it will not reduce the credit for which the family qualifies, but that the family will need to file a return in 2022 to receive the full credit.

For more recommendations from the ABC Coalition regarding the simplified filing tool, read the full letter here.