Federal stimulus update: Will child tax credit monthly payments restart?

Leada Gore
al.com (TNS)

The child tax credit payments – credited with lifting millions American families out of poverty – stopped in December. Efforts to restart the monthly payments are being revived as the economic effects of the COVID-19 pandemic continue.

The path to another round of payments or even making them permanent, isn’t straightforward, however.

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The child tax credit payments were part of President Joe Biden’s American Rescue Plan signed into law in March 2021. The plan raised the existing child tax credit from $2,000 to up to $3,600 per child for ages 5 and younger and $3,000 for each child aged 6-17. Half of the credit - $1,800 or $1,500 – was payable in monthly installments of $300 or $250 per child that ran from July to December 2021. The remainder can be claimed when filing 2021 taxes in 2022.

Congress failed to extend the payments past December but the idea is getting new life under a proposal by Sen. Mitt Romney, R- Utah. Romney’s “Family Security Act” would provide up to $350 per month per child for birth to age 5 and $250 a month for children 6-17. The change would boost the total child tax credit to $4,200 for young children, keeping the credit at $3,000 for ages 6-17.

Under Romney’s plan: The income threshold to receive payments would be $200,000 for single filers and $400,000 for joint filers. Like previous stimulus plans, benefits will be reduced by $50 for every $1,000 above the current child tax credit limits.

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One change in Romney’s plan is the benefit for expectant parents. Parents can apply to receive the benefit four months before the due date of a new child.

The maximum monthly payment per family will be $1,250 and each child must have a Social Security number to be eligible.

You can go here to see how Romney’s plan would be paid for.

While Romney’s plan hasn’t been officially introduced as legislation, it’s already gaining bipartisan interst. U.S. Sherrod Brown, D- Ohio, reportedly met with Romney about his proposal and efforts to make the child tax credit payments permanent.

Brown later said it was optimistic the payments would resume – eventually.

“It’s going to happen, and I hope it’s going to happen in a bipartisan way,” Brown said.