Senate’s Dimming Hope Puts Final Push on Expanded Child Tax Credit Saving

After the onset of the pandemic, Sarah Izabel utilized the additional funds from the child tax credit to enroll her son in an afterschool program, allowing her to focus on applying to graduate school.

Expressing her gratitude, she stated, “These programs provide essential support while individuals strive to better their circumstances.”

In a rare showing of unity, the House passed a tax package in January, garnering widespread approval among parents and advocates. This package includes a new increase in the program, estimated to benefit approximately 16 million underprivileged children in the inaugural year. Despite this, the plan faces an unexpected obstacle in the Senate, where certain Republicans are attempting to thwart its progress.

Ariel Taylor Smith, the senior director of policy and action at the National Parents Union, emphasized the importance of not altering the bill to appease opponents as it could lead to delays in aiding families, especially amidst rising costs like $8 for a jar of peanut butter.

While the proposed child tax credit isn’t as expansive as previous iterations, experts believe it could help alleviate the escalating child poverty rates, with the credit being applicable for the 2023 taxes filed this year.

Passage of the tax package this year represents a crucial opportunity, according to Elyssa Schmier from MomsRising, as families continue to struggle with affording essential expenses.

The pandemic-era child credit, which significantly reduced child poverty based on Census data, provided essential support to families through monthly payments. However, efforts to make this level of support permanent were unsuccessful.

The bipartisan deal struck by Senate finance Chair Ron Wyden and Rep. Jason Smith aims to gradually increase the refundable limit per child, directly benefiting parents. Notably, the proposal seeks to eliminate the limitation tied to the number of children in a family to receive the full credit.

Despite bipartisan efforts, opposition persists primarily around provisions that may transform the program into an entitlement-based setup. Negotiations are ongoing to address concerns raised by Republican senators.

The bill’s progress hinges on securing 60 votes to navigate a potential filibuster and reach a floor vote. While some Republicans are in favor, including Senator Todd Young, Minority Leader Mitch McConnell’s stance seems aligned with the opposition.

Democrats sought to replicate the relief provided by the 2021 expansion in the latest bill; however, compromises were made during negotiations. The ability to receive a more substantial tax refund can significantly impact educational opportunities for families.

Essential to families with school-age children, the monthly payment provision helps cover basic needs while also easing transportation challenges, especially in rural areas where chronic absenteeism is more prevalent.

National Parents Union polling indicates widespread parental support for expanding the tax credit across party lines, underscoring the benefits it offers for basic necessities and educational expenses.

With the economic benefits encompassed in the tax package, proponents assert that it should be a straightforward decision for lawmakers to support its passage.