Republican Senators' Plan Drops the $3,000 or $3,600 Child Credit
A plan by 10 moderate GOP Senators omits Biden's proposal for a higher temporary child tax credit.
President Biden is calling for a number of family-friendly proposals in his American Rescue Plan, a $1.9 trillion stimulus relief package. One element in the plan that Democrats say would help reduce child poverty is his proposal to temporarily expand the child tax credit.
Presently, the child tax credit is worth $2,000 per dependent under the age of 17. Up to $1,400 of the child credit is refundable for some lower-income individuals with children. Biden wants to increase the credit for one year to $3,000 per child ($3,600 for a child under age 6), make it fully refundable and allow 17-year-old children to qualify.
A group of 10 moderate Senate Republicans who believe that Biden's stimulus package is too costly met with the president to discuss their $618 million plan. It calls for smaller stimulus checks for fewer individuals and less unemployment benefits for the jobless, among other things. But it drops Biden's proposal for higher child tax credits.
Sign up for Kiplinger’s Free E-Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
Democrats have shot down the $618 million plan as a nonstarter, mainly because it does not provide aid to state and local governments and its unemployment benefits are not robust enough. Also, many Democrats feel that now is the time to again go big on stimulus to help the economic recovery.
Yet the fact that Biden met with the group of 10 GOP Senators for two hours shows that he is still hoping for bipartisan support on a stimulus package. But if he can't get it, he may very well turn to budget reconciliation to allow legislation to pass the Senate with a majority vote instead of the usual 60 votes to avoid a filibuster. This tool, which is messy, subject to lots of restrictions and can only be utilized for certain items, was last used during Donald Trump's presidency to enact his signature tax law in late 2017.
To continue reading this article
please register for free
This is different from signing in to your print subscription
Why am I seeing this? Find out more here
Joy is an experienced CPA and tax attorney with an L.L.M. in Taxation from New York University School of Law. After many years working for big law and accounting firms, Joy saw the light and now puts her education, legal experience and in-depth knowledge of federal tax law to use writing for Kiplinger. She writes and edits The Kiplinger Tax Letter and contributes federal tax and retirement stories to kiplinger.com and Kiplinger’s Retirement Report. Her articles have been picked up by the Washington Post and other media outlets. Joy has also appeared as a tax expert in newspapers, on television and on radio discussing federal tax developments.
-
Is a Phased Retirement Right for You?
Want to keep working, just not as hard? A phased retirement may just be the answer.
By Kimberly Lankford Published
-
Four Tips to Make Your Sales Presentation a Winner
Being prepared and not being boring can go a long way toward persuading a potential customer to buy into what you’re offering.
By H. Dennis Beaver, Esq. Published
-
'Instant' EV Tax Credits Are a Hit: $580M Paid This Year
EV Credits Claiming federal electric vehicle tax credits at the point of sale is a new and popular option in 2024.
By Kelley R. Taylor Last updated
-
Retirees Face Significant Tax Bills Due to Fraud
Fraud A new report sheds light on how older adult scam victims end up with big tax bills and lost retirement savings.
By Kelley R. Taylor Last updated
-
Tax Day: Is the Post Office Open Late?
Tax Filing Tax Day means some people need to mail their federal income tax returns.
By Kelley R. Taylor Published
-
High Earners: Beware of These Illegal Schemes to Lower Taxes
Tax Schemes The IRS says high-income filers are targets for several illegal tax schemes.
By Katelyn Washington Last updated
-
Mailing Your Tax Return This Year? What to Know Before You Do
Tax Filing There are plenty of reasons not to mail your tax return this year, but here’s what you should know if you are.
By Katelyn Washington Last updated
-
IRS Warning: Beware of Smishing and 'Helper' Tax Scams
Scams Tax season is a time to look out for email and text message scams.
By Kelley R. Taylor Last updated
-
Most Expensive States to Live in for Homeowners
Property Taxes High property tax bills make the places on this list the most expensive states for homeowners to live in.
By Katelyn Washington Last updated
-
Don’t Miss This $2,500 Tax Break for Paying Your Student Loan
Tax Deductions Do you qualify for the student loan interest deduction this year?
By Katelyn Washington Last updated