A major point of contention about the future of the Child Tax Credit (CTC) is about much more than a figure.
The intensity of that disagreement is one of the main reasons why Congress has struggled to reach an agreement on the CTC’s future and why President Biden’s Build Back Better (BBB) plan has stagnated.
Child Tax Credit update
To recap the auction, Republicans doubled the Child Tax Credit from $1,000 to $2,000 per kid in the 2017 Tax Cuts and Jobs Act (TCJA) for couples earning up to $400,000, as per Forbes.
Those who do not pay income tax might get up to $1,400, but they had to earn at least $2,500 to be eligible for any benefit. The Child Tax Credit was increased to $3,000 ($3,600 for each kid under the age of 6) in the 2020 American Rescue Plan (ARP), and it was made completely refundable.
As a result, parents who did not work received the maximum credit, which was a considerable departure from previous refundable benefits. The additional benefits were only allowed until 2021, after which the statute was returned to its 2017 version.
Biden ally urges to amend Child Tax Credit eligibility
A top House Democrat recommended on Thursday that his party reduce Child Tax Credit eligibility in order to jumpstart President Joe Biden’s stalled economic program.
According to Bloomberg, Representative Jim Clyburn of South Carolina indicated in an interview that he would back a lower income threshold in a resurrected version of the Child Tax Credit to persuade West Virginia Senator Joe Manchin to vote for Biden’s Build Back Better plan.
In a radio interview on Thursday, Manchin recommended that the Child Tax Credit be “targeted” to families earning less than $75,000 a year, and that he is open to discussing revisions to preserve it in the bill.