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Child Tax Credit

How The End of The Enhanced Child Tax Credit Has Impacted US Children

Stimulus 1
Stimulus 1

This bill will have a significant impact on the child tax credit extension. What has the President’s administration done to impact so many children? Biden’s agenda of Build, Back and Better with an estimated cost of $1.75 trillion has the people from his own party having doubts about supporting the plan. The reason behind this outcry definitely is worth understanding.

 Impact on child tax credit

The enhanced tax credit that will be used up for backing economic activities will cause almost 10 million children to fall back below the poverty line or sink deeper into poverty, which is extremely distressing. The Centre on Budget and Policy Priorities reported these dismal numbers, which happens to be a think tank of the Government and this is really a cause for concern.

 What’s more alarming, that another 27 million kids will be affected. They tend to lose some of the credit or even all of it. Most of the kids who fall in this category are black and Latino kids, especially those living in the rural area of the US. In all, 65 million kids tend to lose a large chunk of the credit they are due in the coming year.

It will be disheartened for several families this year when they come to know that their children will miss out on the child tax credit. However, there may be some form of respite because of the intervention of the American Rescue Plan enacted in March. They worked out a plan to raise the amount and scope of the benefit on the existing child tax credit.

What the tax credit does

The beneficiaries under the age of six will get double the amount with an additional bonus with monthly payments and deposits made for children under the age of six and a separate amount for the children in the age group of 6-17 years.

The enhanced credit could be available to more children than initially meant to assist. It was also refundable so that families could claim the benefit with eligibility for their kids if they earned no income. There is enough data to prove that several families who have been receiving payments have been benefited from the same.

 

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