A lot of people are interested in the future of the child tax credit now that Vice President Kamala Harris, the Democratic candidate for president, has talked about her big plan to give this credit to families with new babies. During her latest debate with former President Trump, Harris made it clear what she wanted to do.
During the discussion, Harris said, “I have a plan.” “A $6,000 credit for new families during the first year of their child’s life to help them through that very important time in their development.”
Main change in the Child Tax Credit
Harris first talked about this innovative tax break in an economic plan that came out right before the Democratic National Convention. This plan calls for a much bigger tax credit for families with new babies, with the goal of helping them out financially at a very important time in their growth.
Plans to keep the child tax credit in place have become a major issue for both Democrats and Republicans in Washington, D.C. Notably, Donald Trump, the Republican nominee and past president, and Sen. J.D. Vance, who is running with him, have also put forward similar ideas.
A key part of Harris’s plan is to bring back the increased child tax credit that was part of the American Rescue Act of 2021. Many families got a lot of financial help from this increase, and Harris wants to bring those benefits back to help new parents.
New studies show that the temporary rise in the Child Tax Credit in 2021 had a huge effect on lowering the poverty rate among children. The Center on Poverty & Social Policy at Columbia University found that these funds lowered the number of poor children living in poverty each month by almost 30%, which helped about 61 million children.
Understanding the Child Tax Credit
The Child Tax Credit helps parents with kids younger than 17 with their taxes in a big way. This credit was first offered in 1997 and now gives $2,000 per child. Importantly, $1,600 of this amount is refunded, which means you can get it back even if your tax bill is less than that amount. The last $400 is not refundable and can only be used to lower your total tax bill.
Essential Points About the Child Tax Credit
- Introduced in 1997
- Currently provides $2,000 per child
- $1,600 of the credit is refundable
- Remaining $400 is nonrefundable
The child tax credit changed a lot in 2021 because of President Joe Biden’s American Rescue Plan. This helped families a lot. The law made the credit bigger, giving $3,600 to each child younger than 6 years old and $3,000 to each kid 6 to 17 years old. In addition, the credit was fully refundable and part of it was paid back each month as a reward.
What Happened to the Child Tax Credit After 2021?
Congress did not renew this short tax break after 2021, which is a shame. So, the child tax credit went back to where it was before. In 2025, it will go even lower, to $1,000 per child.
Since 2021, attempts to make the credit bigger have failed. The last vote in the Senate, on August 1, failed 48 to 44, with only three Republicans voting in favor.
What is Harris’s Plan for Expanding the Child Tax Credit?
Kamala Harris, the vice president, has shown a strong commitment to helping young families. During the debate on Tuesday night, she stressed how important it is to help families who are raising children. Harris said, “We know that young families need help to raise their kids.” “And I plan to give those families an even longer tax cut.”
The Harris team added an official platform page to its website last Monday, before the debate. It was called “A New Way Forward.” “Cut Taxes for Middle-Class Families” is the Vice President’s plan, which is explained on this page.
A New Way Forward
In this part, Harris talks about her big plan to raise the child tax credit to $6,000 for families with a baby child younger than one year old. The platform doesn’t go into much detail about this plan, but Harris has pushed for bringing the credit back to where it was in 2021 for all children who weren’t born yet.
Commitment to Reducing Poverty
The page says that Kamala Harris and Tim Walz will also increase the Child Tax Credit, which will give families with new babies a $6,000 tax break. “They think that no child in America should be poor, and these actions would change the course of history.”
Harris has made it clear that she plans to raise taxes on businesses and the rich to pay for this expansion and other parts of her economic plan. A group called the Committee for a Responsible Federal Budget did say that the campaign hasn’t gone into detail about the specifics of these tax hikes yet.
- Expand the child tax credit to $6,000 for families with newborns
- Restore the credit to 2021 levels for other children
- Fund the expansion by increasing taxes on corporations and the wealthy
This big plan shows that Harris really wants to help middle-class families and reduce poverty, which is why it’s one of the most important parts of her campaign.
A lot of people have been talking about what Republicans want to do with the child tax credit lately. One of the well-known views is that of J.D. Vance, the Republican senator from Ohio and a close friend of former President Trump. In an August 11 interview with CBS News, Vance said that he was committed to making the credit bigger.
J.D. Vance’s Vision for the Child Tax Credit
Vance said, “I’d love to see a child tax credit that’s $5,000 per child.” Nevertheless, he agreed that he needed to work with Congress to see if such an increase was possible.
Current Status and Historical Context
After the Tax Cuts and Jobs Act was signed into law in 2017, the child tax credit went from $1,000 per child to $2,000 per child. This rise was very big and will last until 2025. This important change was a signature of Trump’s presidency. As for Trump’s current position, his campaign for 2024 told CNBC that he “will consider a significant expansion of the child tax credit,” but they didn’t say what those plans were.
Looking Ahead
Trump’s official “Issues” page doesn’t talk about the child tax credit by name, but it does talk about ways to lower taxes in general. This leaves room for possible changes in policy that would help American families by lowering their taxes.
Why It Matters
Increasing the child tax credit could help families’ finances a lot, which could make the economy more stable and help kids grow and learn. These kinds of ideas are very important because they can have a direct effect on the lives of millions of American families.
If you want to learn more about the background and requirements for getting the child tax credit, you can read about these topics in the past. This will help you understand how shared custody arrangements and other factors might affect eligibility.
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