Parents and caregivers from the Economic Security Project gather outside the White House to advocate for the Child Tax Credit ahead of the White House Conference on Hunger, Nutrition and Health on September 20 in Washington, DC.
Larry French | Getty Images Entertainment | fake images
When Natacha Chavez started receiving monthly Child Tax Credit payments last year, she added $500 a month to her family’s budget.
The funds allowed her to finance things like a new prescription for her son’s glasses that she might have otherwise put off.
But like millions of other Americans, his family received their last monthly check in December when those payments were due.
Having extra income would have helped this year, as Chavez was temporarily out of work and prices at the grocery store and at the gas pump skyrocketed.
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“Every once in a while I keep thinking about how that extra money would have helped offset inflation,” he said.
Chavez, a Democratic campaign organizer, has been active in promoting renewal payments for families who need the money even more than his own.
But amid the ongoing pandemic, record inflation and economic uncertainty, it felt like a long haul.
“At this point, I feel like we’ve been fighting for his renewal for longer than there is,” Chavez said.
How the Enhanced Child Tax Credit Works
The child tax credit has been temporarily expanded by the American Rescue Plan Act in 2021. The existing credit of $2,000 per child under 17 has been increased to $3,600 per child under 6 and $3,000 per child 6-17 .
Half of the increased amount became available through monthly payments beginning last July: up to $300 per child under 6 and up to $250 per child under 18. Families could claim the remaining money when they filed their federal income tax returns. year.
Democrats had hoped to renew the more generous credit this year. But the key piece of legislation they hoped to push through a one-party majority, Build Back Better, has collapsed. Democratic Sen. Joe Manchin of West Virginia opposed renewing the payments without additional work requirements.
Now, Democrats and advocates hope to make another push to renew the enhanced child tax credit this year.
“I feel better about this than anytime in 2022,” said Adam Ruben, campaign manager for the Economic Security Project, an advocacy organization that promotes extending economic power to all.
A number of signs point to renewed momentum, according to Ruben.
Promising new panels
President Joe Biden called the enhanced Child Tax Credit “one of the most effective programs we have ever seen” during the recent White House Conference on Hunger, Nutrition and Health.
“That’s why my national strategy calls on Congress to expand Child Credit permanently,” Biden said.
“We’re going to do it this time,” he added.
Newly released census data shows that credit expansion helped reduce child poverty over 40%. This prompted Democratic lawmakers like Sens. Michael Bennet of Colorado, Sherrod Brown of Ohio and Cory Booker of New Jersey to request the enhanced credit extension before the end of the year.
President Joe Biden speaks at the White House Hunger, Nutrition and Health Conference in Washington, DC on Wednesday, September 28.
Mayor Bloomberg | Mayor Bloomberg | fake images
The post-election period could be a key opportunity to review the proposal, experts say.
There is more optimism compared to last year, as lawmakers see a year-end tax deal to review corporate tax cuts introduced in 2017. Supporters hope an enhanced child tax credit can be included in this package.
“More tax breaks for big business and the rich, unless the child tax credit is around,” Brown said. in a recent interview. “And I’m going to lay down in front of a bulldozer on that one.”
Reducing child poverty is key to success
A few key features were behind the success of the 2021 credit, according to Elaine Maag, a senior fellow at the Urban-Brookings Center for Fiscal Policy.
In addition to higher loan amounts and monthly payments, the loan has also been made fully repayable. This allowed low-income households to access full credit.
Experts say that when lawmakers negotiate new terms, an enhanced child tax credit may not be as generous as the 2021 pandemic-era relief.
“If I could only have one thing, I would like to make sure low-income kids get all the credit,” Maag said.
Parents and children take part in a protest organized by the ParentsTogether Foundation in support of the child tax credit portion of the Build Back Better bill outside the US Capitol on December 13, 2021.
Sarah Silbiger | Mayor Bloomberg | fake images
According to the Center on Budget and Policy Priorities.
Now, child poverty is poised to rise from a year ago, according to Kris Cox, deputy director for federal fiscal policy at CBPP.
“Policymakers have a real choice here if they act and stop some of the increase in poverty,” he said.
How job requirements may be different
“There’s still a pretty big gap between what Democrats are asking for and what most Republicans seem willing to support,” Akabas said.
Advocates of renewing the expanded child tax credit point to the need demonstrated by the data.
“It would be inconceivable for Congress to leave at the end of this Congress, at the end of this year, go home on vacation and leave working families hanging,” Rubén said.