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Families aren’t getting child tax credit checks for first time in 6 months

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Jen Cousins is pictured center with Matt her husband and their three children Noel (13, Saffron (12), Milo (8 and Poppy (6).

Jen Cousins

Jen Cousins, her only vehicle in her six-person family, will not be eligible for a January child credit payment. Jen Cousins must wait several months before she can replace her brakes.

Cousins (44), a mom-at-home mother in Orlando, Florida has received full credit for her children aged six to thirteen, eight and twelve, respectively, for six months. She’s put most of the extra money toward medical expenses – the entire family wears glasses, one child needs special prescription eye drops and speech therapy and soon, her oldest kids will need braces.

Matt, her 43-year-old husband, works as software architect. Although he has insurance through his job, it doesn’t cover him. Jen explained that Jen and the children pay almost $1,000 per month for coverage. There are also additional costs that must be borne out of pocket.

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There are many strange situations that can arise when you have four kids,” she explained. You’ll have to cover $400 for an emergency room visit if someone breaks it.

Her family will be spending more if the credit is not available, she stated. The new year will not bring a tax cut to the 35 million households with 65 million children.

Missing just one check per month can make her feel “pinch,” she stated. It’s about determining where we will trim things, as it has been an extremely good support system for us for six months.

Credit for child tax credits

The American Rescue Plan was passed in March 2020. It increased the child tax credit to $3,000, from $2,000., and added $600 for children younger than 6 years.  

Families received the first half of their credit via monthly checks. These started in July, and continued through December. This year, people will file their 2021 taxes. The second half of credit will follow.

The benefit would have been extended if Democrats had proposed it in their Build Back Better plan. A second check would likely have been sent the second week in January.

After just six months, it is evident that the payments have been successful. The expanded and improved monthly Child Tax Credit, a policy I have been working on since 2003, works,” said Rep. Rosa DeLauro, D-Ct. “It was a lifeline for the middle class — the biggest middle class tax cut we have seen in generations — and lifted 50 percent of children out of poverty.”

However, the Senate blocked the bill by Joe Manchin, D.W.Va., a moderate Democrat. Manchin has also been criticized for the issue of the child credit. It was fully refundable in 2020. That means that a family could claim it regardless of their income. Manchin opposed this bill and suggested adding a requirement for work.

Biden might split the bill in order to move the remaining $1.75 billion proposal. The child tax credit won’t be included in the bill, he says. he told reporters Wednesday.

He said, “I believe we can split the package apart and get as much now as possible and then come back to fight for the remainder of it.”

What would happen if you don’t have credit?

Advocates worry about the possibility of losing the credit and the financial benefits that come with it. Some 10 million children will likely fall back below the poverty lineAccording to the Center on Budget and Policy Priorities (CBPP), this is a progressive think-tank.

It is also possible that people will starve, as early Census Bureau data showed that children are eligible for the Child Tax Credit. led to a quick drop in food insecurityElaine Maag is a Principal Research Associate at Urban-Brookings Tax Policy Center.

Losing parts of the enhanced credit such as full reimbursementability leaves millions of children without access to it, even those living in the lowest income households. The credit is also denied to children of color and Latinos in adisproportionate way.

It’s not going to disappear. Some families may still be eligible to receive the smaller credit in next year’s tax return. If they have eligible children, it is important to file taxes for the second credit or all credit.

Maag stated that data shows that credit can be used by some families to pay off or save debt. This could indicate that they are in a better financial position now.

Next

While Democrats continue to fight for Build Back Better, it is unclear whether the expanded child tax credit will also be passed. In early January, Manchin – whose vote Democrats need to pass the legislation – said he’s had no talksDiscuss the possibility of restarting negotiations over the bill.

There is a way forward. DeLauro stated that he is optimistic we will get the tax cut to the end. “We can’t stop here. There is no way to lose faith. It is impossible to give up on the fight.

The credit could also be increased through legislation. This is possible even in bipartisan terms. Senator Mitt Romney of Utah, proposed last year a bill which would have replaced the child tax credit, but continued monthly checks to eligible parents.

Senator Josh Hawley (Republican from Missouri) proposed a parent credit last year. This would provide a completely refundable tax cut for working parents, and allow them to keep their monthly advance payments.

However, bipartisan legislation has not moved much so far. Families can’t rely on receiving monthly checks anytime soon.

Alana Truss (39), a Las Vegas-based analyst, plans to cancel the credit and hope it returns.

She said, “I don’t want to make it happen and plan for it.” Her husband works at the Social Security Administration. She also has a college-aged daughter who she supports. I’m going to need to be very careful about how much I spend.”

Truss got the whole credit and used it for the growing costs of food and fuel. Her budget won’t be as tight without credit because her rent has been increased recently.

Truss stated, “Not having an extra cushion was a little alarming.”

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