Expanded Child Tax Credit payments coming as Democrats push for permanence

Published: Jun. 24, 2021 at 8:32 AM CDT
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WASHINGTON (Gray DC) - As the Biden Administration looks to eradicate child poverty, millions of American families will soon receive cash payments under an expanded version of the Child Tax Credit.

The United States is on a pathway to putting a massive dent in child poverty—potentially to the tune of a 45 percent reduction, according to Heather Taylor, a communications director for the anti-hunger nonprofit Bread for the World.

“My mother was a working parent—this is a benefit for working families,” Taylor said. “This would’ve been an absolute game changer to have this additional support.”

The Child Tax Credit has been around since 1997, with families eligible to receive $2,000 a year. But an expanded version included in the American Rescue Plan, the wide ranging COVID relief package recently signed into law, bumps the amount to $3,000 or $3,600, depending on income and the age of a family’s children. These payments will come in monthly installments starting in mid-July.

“This will help families to be able to handle their monthly expenses,” Taylor said. “That’s the benefit of this program—monthly expenses like rent, like healthcare, like transportation, and certainly their food and grocery bills.”

The expanded measure will only last one year, for single parents making up to $112,000 or two parents making up to $150,000 annually. But many Democrats want to make the benefit permanent.

Rep. Troy Carter (D-LA) said spending this money now will pay dividends in the future, especially in a state like Louisiana where 15.3 percent of households experience food insecurity—the third highest rate in the country.

“It’s too expensive in this country to have people hungry,” Carter said. “It’s too expensive in this country to have people who can’t afford to care for their children. It’s too expensive in this country to not be able to afford fair housing.”

The USDA spent $23 billion on child nutrition programs in fiscal year 2019, with most of the money going towards free and reduced-price school lunches.

As with most spending packages currently being debated on Capitol Hill, Republicans are wary of making the expanded Child Tax Credit permanent.

Rep. Mike Johnson (R-LA) said a permanent Child Tax Credit will result in fraud and too much government spending.

“This kind of tax credit is cash payments from the government and we just send it out,” Johnson said. “And as everyone knows, we don’t have a lot of government funding right now.”

The government has spent $2.75 trillion as a result of the pandemic. With concerns of rising inflation and debt growth, Johnson argued that credits like these should not be made permanent, adding that he does not believe in this kind of government spending.

“We think that’s dangerous because that’s a direct erosion of our freedom in exchange,” Johnson said. “And that’s something we’ll have to continue to debate here on the Hill.”

Making the tax credit permanent is currently part of the American Families Plan—Democrats’ wide-ranging package still being considered in Congress. Costing $1.8 trillion over ten years, it would also provide Americans with universal pre-K two years of free community college.

For more information on the expanded Child Tax Credit visit childtaxcredit.gov.

Grace Ferguson contributed to this report.

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