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Congress to re-introduce bill with strong support that would grant families up to $3600 per child per year



A bill that was previously introduced to Congress in 2019, is expected to be re-introduced due to more backing on Capitol Hill in addition to President Biden.

U.S. Senators Michael Bennet (D-CO) and Sherrod Brown (D-OH) initially introduced the American Family Act in 2019. The bill overhauls the existing Child Tax Credit. U.S. Representatives Rosa DeLauro (D-CO) and Suzan DelBene (D-WA) introduced a companion bill of the same name in the House of Representatives. The bills were introduced with 37 original Senate cosponsors and 175 original House cosponsors.

According to The Hill, DeLauro and DelBene are looking to re-introduce their bill.

CBS Denver states that President-elect Joe Biden has included Bennet and Brown’s bill in his COVID-19 stimulus package. The bill would cost an estimated $100 billion a year, but according to Bennet, it is worth the cost as he feels it will save far more by giving kids in poverty a way out.

The bill creates a new $300 per-month, per-child credit for children under 6 years of age and a $250 per-month, per-child credit for children under 17 years of age—increasing the credit for all children and, for the first time, making the credit fully refundable.

The American Family Act would replace the current Child Tax Credit. The Columbia University Center on Poverty and Social Policy recently released a report that found the American Family Act would cut child poverty by 38 percent.

Specifically, the legislation would:

•Create a New Expanded Credit for Children under 6. The bill would create a new Young Child Tax Credit (YCTC) of $300 per month ($3,600 per year) for children under 6 years of age, up from the current maximum of $2,000 per year.

•Increase the Maximum Child Tax Credit for All Children under 17. The bill would expand the Child Tax Credit (CTC) to $250 per month ($3,000 per year) for children 6 years of age or older, up from the current maximum of $2,000 per year.

•Make Both Credits Fully Refundable. The bill would make both the YCTC and CTC fully refundable, meaning that all low-income families would receive the full credit for each child. The current CTC only begins to phase-in after a taxpayer has earned $2,500 of income and at a rate of 15 cents for every dollar of additional income. In addition, only $1,400 of the $2,000 credit is refundable. For these reasons, one-third of all children – 27 million – do not currently receive the full $2,000 CTC credit.

•The bill would provide a tax credit for all individuals with children who earn less than $150,000 per year and all married couples with children who earn less than $200,000 per year.

•Index the Credit for Inflation. The bill would index both YCTC and CTC levels for inflation (rounding to the nearest $50) to preserve the value of the credit going forward. The current CTC is not indexed for inflation.

•Set Up Advance Payments on a Monthly Basis. The bill would call on the Treasury Secretary to set up monthly advance payments for the YCTC and CTC no later than a year after passage for taxpayers anticipated to receive a refund.

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