Stimulus Update: Does Build Back Better Defeat Spell the End of Child Tax Credit Payments?

The US Senate works on suspending the debt limit, Washington, Usa - 07 Oct 2021

President Joe Biden’s Build Back Better Act is in serious jeopardy after Sen. Joe Manchin (D-W. Va.) said he would oppose the bill — and as such, it looks like the enhanced Child Tax Credit might have been dealt a death blow as well. Whether the bill passes or no, economic and political analysts remain focused on potential consequences as 2021 draws to a close.

See: No Child Tax Credit in January? Here’s How to Prepare for the Worst
Find: Stimulus Update: Sixth and Possibly Final Child Tax Credit Drops Today

Manchin told Fox News on Dec. 19 that he “cannot vote to continue with” the Build Back Better (BBB) bill, CNN reported. That’s a major setback for Biden’s proposed social safety net program, as every Senate Democrat vote is needed to squeak out the 51-vote majority required to pass the bill into law. One measure in the bill is an extension of the Child Tax Credit (CTC) advance monthly payments that were sent out this year.

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One of Manchin’s criticisms of the BBB plan is that it’s not transparent enough about the impact it would have on federal spending, CNN noted. Manchin specifically mentioned the proposed one-year extension of the enhanced CTC, which distributed six advance monthly payments to eligible American households during the latter half of 2021.

As GOBankingRates previously reported, the enhanced CTC was included in the American Rescue Plan as a way to help families weather the COVID-19 pandemic. In addition to providing advance monthly payments, it hiked the benefit for the 2021 tax year to $3,000 from $2,000, with a $600 bonus for children under 6. Monthly payments typically totaled $300 per child under 6, and $250 per child ages 6 to 17. About 60 million children across the country benefited from the payments.

The IRS has told some lawmakers that the Senate needs to pass the legislation by Dec. 28 for CTC payments to be ready by Jan. 15, 2022. Monthly payments, which began in July, are usually distributed around the 15th of each month.

Learn: Didn’t Get Your Child Tax Credit? Here’s How to Track It Down
Explore: Goldman Sachs Lowers US GDP Forecast Following Manchin’s Build Back Better Opposition

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If the BBB plan isn’t passed — the most likely scenario without Manchin’s support — you can expect that the CTC payment sent out on December 15 will be the last one.

Sen. Ron Wyden (D-Ore.) echoed that point in comments he made last week, before Manchin said he would vote against the BBB plan. As reported by the website, Wyden said that if the Senate doesn’t pass the legislation by Dec. 28, families will have “already received their last monthly payment” as of Dec. 15.

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About the Author

Vance Cariaga is a London-based writer, editor and journalist who previously held staff positions at Investor’s Business Daily, The Charlotte Business Journal and The Charlotte Observer. His work also appeared in Charlotte Magazine, Street & Smith’s Sports Business Journal and Business North Carolina magazine. He holds a B.A. in English from Appalachian State University and studied journalism at the University of South Carolina. His reporting earned awards from the North Carolina Press Association, the Green Eyeshade Awards and AlterNet. In addition to journalism, he has worked in banking, accounting and restaurant management. A native of North Carolina who also writes fiction, Vance’s short story, “Saint Christopher,” placed second in the 2019 Writer’s Digest Short Short Story Competition. Two of his short stories appear in With One Eye on the Cows, an anthology published by Ad Hoc Fiction in 2019. His debut novel, Voodoo Hideaway, was published in 2021 by Atmosphere Press.
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