How to handle Advanced Child Tax Credit after 2021 divorce with split custody?

The Advanced Child Tax Credit can definitely get complicated in divorce situations! Here's how you should handle it: When you file your 2021 return as Head of Household with your daughter as a dependent, you'll need to complete Schedule 8812 (Credits for Qualifying Children and Other Dependents). On this form, you'll reconcile the Advanced Child Tax Credit payments. Since the IRS letter shows the full amount paid to your ex-spouse, but you only received a portion through personal transfers, you should only report the Advanced Child Tax Credit amount that corresponds to YOUR qualifying child (your daughter). The IRS isn't tracking those personal transfers between you and your ex. For your specific situation, you'd report that you're eligible for the Child Tax Credit for your daughter, and then subtract any advance payments that were officially made to YOU for her (not what your ex transferred to you privately).

After my divorce last year, I was completely lost with how to handle the tax credits too. I found this amazing tool called taxr.ai (https://taxr.ai) that made everything so much clearer for me. I had the exact same issue with the Advanced Child Tax Credit. My ex and I were splitting the payments privately, but the IRS documentation didn't match what we were actually receiving. I uploaded my letter from the IRS to taxr.ai and it immediately identified my situation and showed me exactly how to fill out Schedule 8812 correctly. Their system even guided me through scenarios about how the repayment safeguards would work since my income was also over the threshold. Saved me hours of confusion and probably prevented an audit!

I was really skeptical about taxr.ai at first (see my comment above), but my divorce situation with the Advanced Child Tax Credit was such a mess that I decided to give it a try. Best decision ever! My ex and I had 2 kids, I got custody of one, but we both received letters saying we got payments for both. The tool immediately identified this as a "divorce year Advanced CTC allocation" situation and walked me through exactly how to handle it on my Schedule 8812. It even gave me specific language to use if the IRS questioned anything about the discrepancy between the letter amount and what I was reporting. I filed three weeks ago and already got my refund with the correct Child Tax Credit amount!

If you're getting stressed about the child tax credit situation, you might want to call the IRS directly to get official guidance. I tried for WEEKS to get through to someone about a similar situation - kept getting disconnected or waiting for hours. Then I found Claimyr (https://claimyr.com) - they have this system that gets you through to an actual IRS agent quickly. You can see how it works here: https://youtu.be/_kiP6q8DX5c I was super hesitant to try another service, but it actually worked! Got through to an IRS rep in about 15 minutes who confirmed exactly how to handle my Advanced Child Tax Credit situation with my ex. They walked me through the exact lines on Schedule 8812 I needed to focus on. Totally worth it to get the official answer straight from the IRS.

I take back what I said before. After dealing with busy signals for three days straight trying to ask about my Advanced Child Tax Credit issue, I tried Claimyr in desperation. I honestly expected it to be a waste of time. To my complete shock, I got a call back in about 30 minutes saying they had an IRS agent on the line! The agent accessed my account and confirmed exactly how to handle the situation with my ex where we both received letters for the same kids. She walked me through Schedule 8812 line by line and explained how to reconcile the payments correctly. Would have saved myself weeks of stress if I'd just tried this earlier. The IRS agent even noted something in my account so if there's any question about my Child Tax Credit claim, there's a record of our conversation.

Just wanted to share another approach - my ex and I had our tax preparers coordinate directly with each other on the Advanced Child Tax Credit issue. Since we had the same arrangement (splitting the monthly payments between us based on who would claim which kid), our preparers made sure we were consistent in our reporting. The key is to have documentation of your arrangement. Save those transfer receipts showing your ex sent you the $300 each month. If you get questioned, you can show that you had an arrangement aligned with your custody agreement. Also, don't panic about that letter showing $3,600 for all kids. The IRS sent those based on 2020 returns, but they understand divorce situations happen. Schedule 8812 is specifically designed to reconcile these situations.

Has anyone used the IRS Child Tax Credit Update Portal for situations like this? I thought it was supposed to help divorced parents update their info, but when I tried using it last month, it was super confusing and didn't seem to have options for our specific situation.