Could the Child Tax Credit Come Back? If the 2024 Budget Passes, It Might
Written by
Josephine Nesbit
Commitment to Our Readers
GOBankingRates' editorial team is committed to bringing you unbiased reviews and information. We use data-driven methodologies to evaluate financial products and services - our reviews and ratings are not influenced by advertisers. You can read more about our editorial guidelines and our products and services review methodology.
20 Years
Helping You Live Richer
Reviewed
by Experts
Trusted by
Millions of Readers
President Joe Biden’s budget proposal for the 2024 fiscal year calls for fully restoring the Child Tax Credit (CTC) enacted in the American Rescue Plan. The CTC cut child poverty in half in 2021 to the lowest level in history.
The Biden administration’s budget plan, released on March 9, would expand the tax credit from $2,000 per child to $3,000 per child for children six years and older, and to $3,600 per child for children under six. In addition, the budget would permanently reform the credit to make it fully refundable. This means children in the lowest-income families would not be excluded and would allow families to receive monthly advance payments.
The president also aims to permanently expand the Earned Income Tax Credit for childless workers to help fight poverty.
The expansion of the CTC expired in Dec. 2021 due to Republican opposition and objections from Democrat Se. Joe Manchin, who wanted a work requirement added to the credit.
According to the US Census Bureau, child poverty fell to 5.2% in 2021 — a record low — down from 9.7% in 2020 because of the monthly checks sent out to parents, Business Insider reported. The CTC expansion helped lift 2.9 million children out of poverty, with 1 million of those children under six years old.
The budget proposal still needs Congressional approval, but the House and Senate are not obligated to pass the budget. Normally, changes are made prior to a budget passing. In addition, Congress could opt to pass a continuing resolution instead, ABC Action News reported.
Republican lawmakers have already voiced their opposition to the proposal, but there has yet to be a counteroffer.
More From GOBankingRates
