The promised relief bill was finally approved by President Biden last Thursday. The bill includes a child tax credit clause that was one of the winning promises of Biden’s campaign. Experts say that it is expected to children suffering from poverty to half as many, at the very least.
That is not all. Families have the option to use that credit to receive a reduction in their income tax that they owe to the federal government. They can also get a payment of $300 maximum per month for each child.
The Amount Involved In The Child Tax Credit
Currently, some provisions allow a claim of $2,000 maximum for each child. The new bill will increase that limit by $1,000, to a total of $3,000, applicable for children between 6 and 17. The amount increases to $3,600 when the child is below 6. However, a single parent can avail of it only if his/her annual income is under $75,000. Joint income families have a limit of $150,000.
John Barbour, who resides in Philadelphia, appreciated the child tax credit and said that they will be a big help with the financial situation. Moreover, the credit has a provision to be refunded. This implies that a greater number of families with a tax bill amounting to $0 can avail of it. Families can also choose to be paid across a pre-determined period rather than all at once.
The child tax credit is available only for this year, for now. However, Democrats are bullish about their intention of turning it into a permanent feature. Experts differ on the refundable aspect with Kathy Fisher calling it a very smart move. Fisher is one of the policy directors of Coalition Against Hunger. However, associate professor of economics, David Florenza was wary that such an amount of debt could end up lasting generations.