President wants to reinstate $300 monthly payments to families with children, but there will probably be opposition to the idea.

According to President Joe Biden’s budget proposal for 2024, $300 monthly payments to families with children—which are widely acknowledged to have assisted in bringing people out of poverty—would be reinstated.

Biden suggests bringing back the Child Tax Credit, which was initially approved as part of the American Rescue Plan and was credited by the White House with halving child poverty to its lowest point ever.

According to the White House, President Biden has long believed that the economy should grow from the bottom up and middle out, rather than from the top down. So, despite significant challenges, that economic strategy has resulted in historic progress for the American people over the last two years.

The maximum annual credit available to eligible families paid per child under the age of six would rise from $2,000 to $3,600. The credit for children aged 6 and up would be increased to $3,000.

In his Build Back Better legislation, Biden sought to make the credit permanent; however, the legislation was doomed by opposition from Senate Republicans and Democrat Joe Manchin. The credit was extended until December 20, 2021.

Now, Biden’s fiscal 2024 plan proposes bringing it back and making it permanent.

In order to help families in need pay their monthly expenses, including rent, utilities, food, childcare, and transportation, supporters of the credit argued that it should be maintained.

They also point out that the credit is beneficial to local economies. Families who receive the child tax credit typically spend it locally to help meet their needs.

During the Build Back Better debate, the Center on Budget and Policy Priorities stated that When families struggle to meet their monthly expenses, they frequently resort to debt to make ends meet; a monthly benefit alleviates this strain.

According to a study by Columbia University’s Center on Poverty and Social Policy, the credit kept income in households for up to 3.4 million children above the poverty line.

When the credit expired, it impacted more than 65 million children across the country.

According to the Center on Budget and Policy Priorities, nearly 9.9 million children fell back into poverty. With 1.69 million and 1.08 million children affected, respectively, California and Texas led the way.

The tax laws are very complex. Our short blog articles can only partially cover all the rules and nuances. Your specific facts may hold various opportunities and possible risks that only trained, experienced, and highly qualified tax specialists can spot. We encourage you to find such help, rather than trying to figure it all out alone. Consider trying the iFindTaxPro marketplace by posting your project and signing up here. 

If you are a licensed tax professional interested in helping others either part or full-time, or ad hoc, come on in! Happy to have you. Our marketplace has the full suite of tools to communicate with clients including compliance calendars, task and message management, and billing. You can also quickly connect to knowledgeable colleagues who can complement your services with the ones you do not provide. Register here.