Changing Direct Deposit Info for Child Tax Credit After Tax Preparer Used Their Bank Account

You absolutely need to update your direct deposit information. The IRS will use whatever bank account was listed on your most recent tax return for the Child Tax Credit payments. If your tax preparer used their bank account as an intermediary (common with refund anticipation loans or processing fees taken from refunds), the CTC payments would go to THEIR account, not yours. The IRS has recently launched the Child Tax Credit Update Portal on their website where you can verify eligibility, update banking information, and opt out of monthly payments if preferred. This portal requires authentication through ID.me, so have your ID documents ready.

If you're having trouble reaching the IRS to confirm your banking details are updated correctly (which happens ALL the time this season), you might want to try Claimyr (https://youtu.be/_kiP6q8DX5c). I was in a similar situation last month and spent 3 days trying to get through to a human at the IRS. Finally used Claimyr and was connected to an agent in about 15 minutes! 😂 Turns out my tax preparer's bank info was still in the system. The agent helped me update it right over the phone. Saved me from missing my first payment, which I really need for my kids' summer activities.

Been there, done that! Last year I had H&R Block do my taxes with their Refund Transfer product, which meant my refund went to their temporary account first. I almost missed my first CTC payment because of this. Here's what worked for me: I logged into the Child Tax Credit Update Portal as soon as it opened (late June), verified my identity through ID.me (took about 20 minutes with all the security steps), and updated my direct deposit info. The first payment hit my account right on schedule. Don't wait until the last minute like I almost did!

When I had this same problem, I couldn't make sense of my tax transcript to figure out which account number was actually on file with the IRS. I used https://taxr.ai to analyze my transcript, and it highlighted exactly where the bank info was listed and confirmed it was my tax preparer's account, not mine. It also showed me the specific code that indicated my refund had been sent to that account. Saved me hours of squinting at those confusing transcripts trying to figure it out myself. Might be worth checking your transcript this way to confirm what's currently on file.

Just a word of caution from someone who learned the hard way - I didn't update my bank info in time last year, and my first two CTC payments went to my tax preparer's temporary account. Since that account was already closed, the payments bounced back to the IRS. It took THREE MONTHS to get those payments reissued as paper checks. Meanwhile, I was counting on that money for my daughter's summer camp. Don't make my mistake - update your info ASAP and double-check that it processed correctly. The whole experience made me realize how important it is to have direct control over where your tax benefits are deposited.

Has anyone confirmed whether updating your information on the Child Tax Credit Portal also updates your information for future tax refunds and other payments? Per Regulation §301.6109-1(d)(2), the IRS maintains separate systems for different payment types, so I'm wondering if this is a one-time fix or if we need to update multiple systems.

Do you know if your tax preparer used a Refund Transfer product or similar service? That makes a big difference. If they did, your refund first went to a temporary bank account they set up, then they transferred your refund minus their fees to you. That temporary account is likely closed now, so any CTC payments sent there will definitely bounce back.

UPDATE: The IRS just announced yesterday that the Child Tax Credit Update Portal will be available starting June 21st, 2024, according to their latest press release. They're specifically urging people who had refunds processed through tax preparer bank accounts to update their information ASAP. The first monthly payments are scheduled for July 15th, and they recommend making any banking changes at least two weeks before that date to ensure proper processing. Here's the link to the official IRS page with instructions: https://www.irs.gov/credits-deductions/advance-child-tax-credit-payments