U.S. Department of the Treasury

(Archived Content)

FROM THE OFFICE OF PUBLIC AFFAIRS

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The process for issuing checks for the advance payment of the child tax credit takes 6-8 weeks. The IRS begins by running a program to search more than 130 million 2002 tax returns filed earlier this year to identify taxpayers eligible for the advance payment. A calculation is performed for those eligible for the credit to determine the amount of the check and the data is transmitted to Financial Management Service (FMS), the agency in Treasury which issues all federal government checks - like Social Security, government employee and Military pay checks. A testing process is also performed to minimize errors.

The Jobs and Growth Tax Relief Reconciliation Act of 2003 provides for the issuance of checks to approximately 25 million eligible taxpayers. As a result, checks are scheduled to be issued beginning July 25, 2003 in the following manner:

The Senate has passed a bill that provides for approximately 7 million additional advance child tax credit checks to be issued. Many press reports have inaccurately reported a time frame for which these additional checks proposed by the Senate-passed legislation would be issued.

If the additional checks were to be included with those provided for by the Jobs and Growth Act, that would cause a delay of nearly one month for the 25 million taxpayers scheduled to receive checks beginning in late July. This is because IRS would be required to restart the identification and calculation process begun last month. Alternatively, the process for the additional round of checks can begin only after the first round of checks is issued.

In order to not create any significant delay in issuing the 25 million checks provided for by the Jobs and Growth Act, a second round of checks could not be issued until mid-September.

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