CNN

With child poverty falling last year, a group of Democratic lawmakers and progressives are pushing to restore at least part of the child tax credit that has eased the finances of many families since the year 2021.

While their prospects are slim, the coalition’s priority is to refinance more loans so lower-income families can qualify, as they did last year for the temporary extension of the Democrats’ $1.9 trillion American Rescue Plan. Nearly 19 million children will miss out on the full $2,000 benefit this year because their parents earn too little, the Tax Center estimates.

The lawmakers, led by Sherrod Brown of Ohio, Michael Bennet of Colorado and Cory Booker of New Jersey, led by the Senate, hope to include the provision in the bill on the government spending that Congress is trying to fix before the appropriations bill expires on December 16. , they want to tie it to corporate tax cuts that Republicans and corporations support.

But the effort faces many obstacles. His supporters have just a few more weeks before the GOP takes control of the House, halting any increase in the refund. This makes it more necessary for Congress to approve a full-year funding agreement this month, rather than the possible scenario of a short-term extension to 2023.

Another challenge: At least 10 Republican senators must sign on to pass the measure, and it is believed to have the support of Democratic Sen. Joe Manchin of West Virginia, who last year vetoed the credit extension. -child tax credits, along with other challenges. much of President Joe Biden’s social spending package.

While Bennet wants the debt to be fully repaid so that all low-income families get all the benefits, regardless of their income, he said he’s keeping an open mind.

“I see it as an effort to try to cover the majority of the 19 million children who are not involved in debt right now and cover them in a meaningful way,” he told CNN.

But he acknowledged that negotiations with the GOP have been difficult because of uncertainty over the government’s funding bill.

The child credit already has bipartisan support, though Republicans have been wary of fully reinstating it because they worry it could discourage parents from working.

GOP Sen. Mitt Romney of Utah, a longtime advocate of child loans, drafted an improved version earlier this year, along with Sens. Richard Burr from North Carolina and Steve Daines from Montana. Families must have earned $10,000 in the previous year to receive the full benefit, while those with low incomes are eligible.

More low-income children would be included in the proposal, which contains other provisions that progressive advocates do not like. But the very poor will still be excluded.

The American Rescue Plan made three major changes to the child loan for 2021. It was increased to $3,600 for children under 6 and $3,000 for those 6 and under. It’s 17 years old. up to $150,000 received in full.

In addition, the loan was fully repaid to allow the lowest income families. And sent half of the loan to the family every month up to $300 from July to December last year to help them pay their expenses. They can claim the other half on their 2021 tax return.

More than 36 million families with more than 61 million children earned a monthly salary of $93 billion, according to the Internal Revenue Service.

Before the expansion, qualifying parents received a credit of up to $2,000 for children up to age 17 when they filed their taxes. This is effective in 2022 as the improvements are over.

The expansion would lift 2.1 million children out of poverty by 2021, according to the Census Bureau. It helped reduce child poverty to 5.2%, down 46%, according to the bureau’s additional poverty measure.

If monthly payments were offered, food insecurity decreased and families said it was easier to pay their household expenses, said Elaine Maag, associate director of the Tax Policy Center.

He takes issue with the argument that mortgages kept parents out of work and caused inflation.

“It’s a real way to support the work. In some cases, the money was used by people to pay for childcare, for transportation,” he said. “The borrowing is not big enough to push up the cost of living. But there is enough money for very low-income families to compensate for the effects of inflation.”

For Luz and Rafael Garcia, the $750 a month they received for their three children last year means they can pay their bills without having to check their money as often as possible. the bank to make sure it has enough money.

The Garcias, who live in Lake Elsinore, California, both work – she as a bilingual educator in the local school district, he as a machine operator. But they’re still living paycheck to paycheck, so getting monthly infusions last year gave them hope, especially as gas prices rose.

“We’re going back to using our credit cards for unexpected expenses, even everyday expenses,” said Luz Garcia, 42. for that next paycheck.”

There is a way expand the child credit that would give parents an incentive to work without contributing to inflation, said Michael Strain, director of economic policy studies with American Right-leaning Enterprise Institute. Improvement should be concentrated on low-income families, and the amount of debt should increase with income until it reaches full benefits.

“It will have the effect of reducing poverty by providing credit to households without wages, but it will also encourage income,” he said. “There’s a way to accomplish a lot of people’s goals here.”



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