Will it be extended for 2022?
In 2021 and 2022, the the average family will receive $ 5,086 in coronavirus stimulus money thanks to the expanded child tax credit. This money was authorized by the American Rescue Plan Act, which provided for dunning checks and expanded the tax credits to which parents with children are entitled.
Previously, parents were eligible for a $ 2,000 child tax credit, of which only $ 1,400 was refundable – and they couldn’t get the money until they filed their tax returns. Under the American Rescue Plan Act, the credit has been increased to $ 3,600 for children under 6 and to $ 3,000 for older children. The credit has also been made fully refundable (eligible people can get the full amount owed to them, regardless of how much tax they owe). And half is delivered to the people Bank accounts in installments of $ 250 or $ 300 per month from July to December of this year.
Credit has had a major impact on the finances of many American families. But under the current law, it will only be available for the 2021 tax year. The big question is whether lawmakers will extend it so that parents can benefit from this money for years to come.
Will the expanded child tax credit be extended?
President Joe Biden and many left-wing lawmakers believe the expanded child tax credit should not be a one-time credit for 2021. Under a bill called the Build Back Better Act, the credit would be extended to ‘in 2024 or 2025. This would mean that the parents would receive the extra money for several more years. And, given the nature of government benefit programs, it is likely that politicians would expand them further rather than allowing a benefit that people depend on to expire.
But although there is a proposal to extend credit, there is still no guarantee that it will come to fruition. The Build Back Better Act is a $ 3.5 trillion human infrastructure bill that would create many new government programs, but its passage is far from guaranteed.
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Currently, Republicans are united against the bill, which would mean the legislation would have to embrace party lines. Democrats have a slim majority in the US House of Representatives and the US Senate is tied 50-50 (although Vice President Kamala Harris could serve as the deciding vote).
Since Republicans can obstruct legislation in the Senate and demand 60 votes to move the bill forward, Democrats should pass the bill through a process called reconciliation. They cannot afford to lose even one voice in doing so, and wide disagreements between centrists and progressives can make the battle difficult.
Prolonged relief is not guaranteed
While many on the left support Build Back Better, some of the more conservative Democrats in the House and Senate have expressed concerns about the price of legislation as well as the timing of a bill’s passage. In fact, West Virginia Senator Joe Manchin has suggested that the benefit should come with labor requirements if the tax credit is to be extended, something other members of his party are opposed to. vehemently.
Ultimately, it will become clearer in the coming weeks whether the Build Back Better Act, or some variation of it, can pass. If so, some form of the expanded child tax credit will likely be part of it, although it may not apply to the same number of families receiving the credit this year.
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