Biden touts 'historic' effort to end child poverty through expanded child tax credit
By Donald Judd, Tami Luhby and Kate Sullivan, CNN
(CNN) -- President Joe Biden on Thursday touted the expanded child tax credit, a provision of his administration's Covid-19 relief package aimed at reducing child poverty that he believes could change the lives of working-class families.
"This can make it possible for a hardworking parent to say to his or her child: 'Honey, we get, you can get your new braces now. We can get you a tutor to help you in the math class you're having trouble with. We can get you the sports equipment you need to sign up for your first team you're going to play on,'" Biden said from the White House.
"For every child under the age of 6, a parent will get $3,600 a year. For every child 6 to 17, they'll get $3,000 per year. For example, a middle class family with two young children should expect to receive $7,200 a year to help raise their children," Biden said.
Biden continued: "They'll get the first half of this $3,600 starting today. Today. Today. And it will be paid out at $600 a month between now, July, and December. And then they'll get the rest of the payment next spring, around Tax Day."
Starting Thursday, the White House says, American families should expect to see payments on the 15th of every month -- providing them with extra funds -- through the end of 2021, with an accompanying tax break when they file their returns next year. The vast majority of families -- roughly 39 million households, covering 88% of children -- will get the credit automatically because they filed 2019 or 2020 returns claiming the credit. Families that file taxes electronically should see payments in their accounts Thursday that say "CHILD CTC," while families that file via mail should expect checks in "several days," per the administration.
The White House projects the payments will be "transformative" for families, leading to "the largest-ever one-year decrease in child poverty in American history," the official said.
Families that haven't filed tax returns recently or used the non-filer tool last year to get their stimulus checks can use an IRS portal to register to receive the enhanced child tax credit. The sign-up tool allows users to provide the necessary information about their households and, if they choose, their bank accounts so the agency can directly deposit the funds.
In his remarks highlighting the credit Thursday, Biden "will highlight the adjustments that were made to the CTC so that the families that need help the most get the full amount of this tax cut, as well as the return on investment it provides for our nation's children."
"For the first time in our nation's history, American working families are receiving monthly tax relief payments to help pay for essentials like doctor's visits, school supplies, and groceries," Treasury Secretary Janet Yellen said in a statement Wednesday evening. "This major middle-class tax relief and step in reducing child poverty is a remarkable economic victory for America -- and also a moral one."
The full enhanced credit will be available for heads of households earning $112,500 and joint filers making up to $150,000 a year, after which it begins to phase out.
For many families, the credit then plateaus at $2,000 per child and starts to phase out for single parents earning more than $200,000 or married couples with incomes above $400,000.
More low-income parents will become eligible for the child tax credit because the relief package makes it fully refundable. It had been only partially refundable -- leaving more than 26 million children unable to get the full credit because their families' incomes were too low, according to Treasury Department estimates.
The first payment comes as Biden's sweeping social agenda clears a crucial hurdle. Senate Democrats on the Budget Committee announced Tuesday that they'd reached an agreement on a $3.5 trillion budget resolution, including spending for Biden's social proposals.
The President will also use part of his remarks Thursday to "underscore the importance of passing the American Families Plan as part of his full Build Back Better agenda to make sure this tax cut will continue for working families for years to come," the official told CNN on Wednesday.
This is a breaking story and will be updated.
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