Numerous lawmakers are still fighting for the renewal of the extended Child Tax Credit program before the year ends. There is a reasonable chance the program will be renewed, but not without a few provisions, says Backman.
In March 2021, the American Rescue Plan was signed into law which extended the Child Tax Credit program. Before 2021, every child can receive a tax credit value of up to $2,000 that was only partially refundable. This means that a family without tax liabilities cannot fully receive the $2,000 tax credit. However, in 2021, the tax credits’ maximum value has increased. For children aged 6 to 17, the tax credits were up to $3,000. For children below 6, the tax credits were up to $3,600. These tax credits also became fully refundable. Half of these are available for monthly payments and were distributed in the second half of 2021.
Arguments About the Program
According to Backman, many lawmakers from both the Democratic and Republican parties agree that a renewal of the Child Tax Credit program is necessary. However, these parties cannot seem to agree on the rules that surround the program. Some lawmakers want to establish a minimum earnings requirement for the eligibility for the program. On the other hand, there are those who oppose saying that this certain requirement will hinder the households with the lowest incomes to receive the tax credit in full.