House Democratic leaders announced legislation today to send at least $3,000 per child to millions of households, pushing a central clause in the $1.9 trillion Covid-19 stimulus bill from President Joe Biden.
According to a committee spokeswoman, Ways and Means Committee Chairman Richard Neal, who is heading the preparation of the stimulus plan's legislation, would present the expanded Child Tax Credit bill.
"The pandemic is driving families deeper and deeper into poverty, and it's devastating. We are making the Child Tax Credit more generous, more accessible, and by paying it out monthly, this money is going to be the difference in a roof over someone's head or food on their table," Neal said in a response.
For a full year, the law will include $3,600 per child under the age of six and $3,000 per child between the ages of six and 17. For single parents making up to $75,000 annually and for couples earning up to $150,000, the maximum value is eligible. At those thresholds, benefits will be phased out. Families could receive monthly Child Tax Benefit checks, which supporters argue will make it easier to meet their commitments due to having a lump sum at tax time.
If Congress approves this unique law, the payments will commence with one year in July. Another big difference would be that the loan would be entirely refundable for the year. According to the left-leaning Center on Budget and Policy Priorities, about 27 million children actually live in low-income households who gain a partial or no tax credit because they earn too little. The present Child Tax Credit pays up to $2,000 per child under the age of 17. The credit phases out for single parents with a changed, adjusted gross income over $200,000 and $400,000 for married couples.
A single benefit is earned by households. According to a non-partisan Tax Research Center study, about 90 percent of families with children will earn an average credit of $2,380 in 2020. Connecticut's Rosa DeLauro, Washington's Suzan DelBene, and New York's Ritchie Torres are all expected to propose standalone bills on Monday that will indefinitely extend the extended gain.
In a statement first made to CNN, Congress should enact the expansion indefinitely if there is a possibility, DeLauro, who has been working on improving the child tax credit since 2003, said in a statement. "We cannot stop here. We must use this moment to pass the American Family Act and permanently expand and improve the child tax credit. One year is not enough for the children and families battling not just the coronavirus, but poverty, too,"
A few Republicans also embrace the Child Tax Credit increase. Last week, Utah Sen. Mitt Romney announced a plan to include a $350 monthly cash reward for each small child ($4,200 annually) and $250 for each school-age child ($3,000 annually). However, his bill would also abolish many existing government aid services, including Transitional Assistance for Needy Children and tax provisions, including state and local tax deductions. While not contributing to the federal budget, Romney said his proposal would bring almost 3 million children out of poverty. That would cost around $66 billion, including the Earned Income Tax Credit adjustments that would follow it.
Biden's relief package, which he introduced last month, called for a one-year increase in the Child Tax Credit to alleviate poverty. The President's budget also includes an extension to further low-income workers of the Earned Income Tax Credit, along with $1,400 stimulus checks and, among other measures, expanded unemployment, nutrition, and housing assistance.
Biden said last month before signing two executive orders that would increase nutritional assistance and improve federal worker rights, the American Rescue Plan would bring 12 million Americans out of poverty and cut child poverty in half. That's 5 million children lifted out of poverty.
Biden also noted that the plan would decrease poverty by one-third among black families and almost 40 percent among Hispanic households. According to the Commission for a Balanced Federal Budget, a non-partisan economic watchdog, a one-year extension will cost around $120 billion.
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