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Is there a child tax credit for January?

In December, more than 36 million families received monthly child tax credits.

Charleston, West Virginia — For the first time in half a year, Friday’s family Monthly deposit from Child tax credit — A program aimed at becoming part of The legacy of President Joe Biden But instead Flash point Who Deserves government support..

Retired Andie Roberts from St. Albans, West Virginia, relied on checks to raise two young grandchildren adopted by him and his wife as their born parents recovered from drug addiction. ..

Roberts is out for $ 550 this month. The money helped Girl Scouts, ballet, acting lessons, and paying for children’s shoes. Roberts pointed out that it is more expensive than adult shoes. He said the tax credit was a “heavenly blessing.”

“If you need to tighten something, it will force you to tighten your belt,” Roberts said about losing payments.

The monthly tax credit was part of Biden’s $ 1.9 Trillion Coronavirus Relief Package — And the President proposed extending them for another year as part of another measure focused on. Economic and social programs..

But democracy Senator Joe ManchinOpposes expanding credit from Roberts’ hometown of West Virginia, fearing that money will discourage people from working and that additional federal spending will drive inflation, which has already reached highs for nearly 40 years. did.

According to IRS dataLast month, 305,000 children in West Virginia benefited from credit expansion.

Manchin’s opposition in the evenly divided Senate upset Biden’s social spending package and expired the extended tax credit that came out in the middle of every month in January. This is holding back family income at the very moment people are working on higher prices.

However, the family receives only half of the 2021 credits each month, and the other half will be received if they file their tax returns within the next few months. The size of the credit will be reduced in 2022 and the full amount will only be paid to families who have earned enough income to pay the tax. This is a policy choice that limits the interests of the poorest households. And 2022 credits will only be incurred when people file their taxes at the beginning of the following year.

A West Virginia family interviewed by the Associated Press emphasized how food and petrol bills have risen and said they need less financial cushioning than they did a few months ago.

Roberts, who worked as a car dealer for 50 years, said, “You have to learn to adapt. I never dreamed that everything would explode suddenly. Get off and get a hamburger package, £ 1 7 ~ $ 8. “

The Biden administration calculated that the expanded child tax credit and its monthly payments were the success of the policy of paying $ 93 billion over six months. In December, more than 36 million families were paid. Payments were $ 300 / month for children under 5 years old and $ 250 / month for children between 6 and 17 years old.

The Treasury has refused to respond to questions regarding the expiration of the expanded child tax credit. This has become a politically sensitive issue as part of Biden’s $ 2 trillion economic package, which is stagnant in the Senate.

Manchin has endorsed some form of labor requirement for those who receive payment, fearing that government auto aid could leave people quitting their jobs. But in a written statement last month, his main objection was that he expressed concern about inflation and masked the true cost of tax credits, which could make the one-year extension permanent. Was avoided.

“My democratic colleagues in Washington are determined to dramatically reshape our society in a way that makes our country even more vulnerable to the threats it faces.” Said Manchin. He added that he was worried about inflation and the size of government bonds.

The Census Bureau investigates Recipient spending patterns for September and October. Nearly one-third used credit to pay for school fees, and about 25% of families with young children used credit to raise children. About 40% of recipients said they depend mostly on money to pay off their debts.

There is another advantage in improving the outcomes of poor children. Families of poor children previously did not have access to a full tax credit because their income was too low.Analysis by Urban Institute It was estimated that expanding credit as developed by the Biden administration would reduce child poverty by 40%.

As some lawmakers feared, tax credits did not cause an immediate escape from the workforce. The Reported by the Bureau of Labor Statistics The percentage of people working has increased from 58% in the month before monthly payments began to 59.5% in the last month. The same trend occurred in West Virginia, where the employment population ratio rose to 52.9% before the pandemic.

There is academic debate about whether credit can curb employment in the long run, and most studies suggest that its effects are statistically negligible.

Scholars studying tax credits are wondering how permanent programs affect the economy and child welfare.

Catherine Michelmore, an associate professor of public policy at the University of Michigan, and two other researchers estimated that approximately 350,000 parents would leave the workforce. This is less important in an economy with around 150 million jobs.

Michelmore said the long-term effects of permanent tax credits would have a positive impact on the economy. It may be 50 years away, but in the future we will be able to reduce costs even further. “

One of the key questions for policy makers is whether bureaucrats or parents are good at spending money on their children. Manchin has a 10-year funded version of Biden’s economic proposal to abolish the focus of child tax credits and instead fund programs such as universal kindergartens to avoid sending money directly to families. I made a suggestion.

“It’s a moral issue whether families trust their decisions,” Michelmore said.

Hairdresser Chelsea Woody is a single mother from Charleston, West Virginia, who works six days a week to earn money. The extended child tax credit payment not only helped her son pay for day care, but also dressed her for him.

“It really helps a lot. Instead of worrying about how to pay the invoice or what happened, it’s an extra cushion,” Woody said when loading groceries into the car. “It helps a lot of people. It helps to get the family to work because we have the hardest time. I work all the time, so I rarely stay at home with my kids.”

Hussein reported from Washington and Boke from Baltimore.

Is there a child tax credit for January?

Source link Is there a child tax credit for January?

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