Child Tax Credit: Could a New Senate Proposal Bring $350 Monthly Checks?
Since the end of the enhanced child tax credit payments in December, talks about extending the monthly checks have waned. But a new Senate bill introduced by Republican Sen. Mitt Romney, called the Tribe Security Act 2.0 (PDF), could bring the discussions back to life.
The new bill comes with a work requirement, leaving many families out who may need the cash the most or offering smaller amounts than the enhanced payments. Romney’s proposal does, however, include expecting parents who are within four months of their due date.
We’ll divulge who would be eligible under this new plan and all of the requirements. We’ll update this story as new information develops.
How much cash families could potentially get under the proposed child tax credit plan
For each child thought the age of 6, eligible parents would receive up to $350 per month, totaling $4,200 annually per kid. The number of children eligible would be capped at six, for a max total of $2,100 per month, or $25,200 annually.
For each kid between the ages of 6 and 17, eligible parents would claim up to $250 per month, totaling $3,000 per kid per year. The number of children families can disclose would be capped at six, for a maximum amount of $1,500 per month or $18,000 annually.
What are the means eligibility requirements for Romney’s plan?
The new child tax credit bill includes a work requirement. Families must have earned $10,000 or more in the past year to claim the full benefit — the $10,000 earnings threshold would be annually indexed to inflation. Those who make less than $10,000 would receive a phased-out amount. For example, a family with a 3-year-old child and earning $5,000 in the last year would receive half of the $4,200 benefit, totaling $2,100.
There are also means phaseout thresholds for higher earners. The annual benefit would decrease by $50 for every $1,000 earned over $200,000 per year for single filers and $400,000 for joint filers.
Expecting parents would also claim payments under the plan
With the 2021 child tax credit, parents were able to receive the full amount — up to $3,600 — if their child was born by the end of December. The new Republican Senate proposal also includes expecting parents. Those who are four months away from their due date would claim up to $700 per month, totaling $2,800 during the pregnancy.
However, it’s unclear what happens to the money that’s already been paid if a pregnancy doesn’t result in a child. It’s also unclear if the total monthly amount increases for those pregnant with twins or more.
The bill includes a work requirement.
James Martin
What new requirements are there?
Aside from income requirements, to be eligible for the proposed child tax credit, both parents and claimed dependents must have Social Safety numbers.
How the new child tax credit would be paid for
The Tribe Security Act 2.0 would be paid for by “consolidating existing federal spending,” according to Romney’s bill. That includes “reforming” the Earned Income Tax Credit, eliminating area and local tax deductions, eliminating the head of household filing space and eliminating the child portion of the child and dependent care credit. The plan estimates that these changes would save roughly $92.2 billion annually.
What are the drawbacks of this proposal?
While this new bill would bring money to millions of families, it isn’t fully refundable. That means parents who earned less than $10,000 in the last year would receive less money, phasing out to no payment at all for families with no income.
Also, eliminating the head of household filing status and reforming the EITC using single filing families with low to moderate incomes would end up losing out on cash under this plan, according to the Center on Cheap and Policy Priorities. This is because the EITC cut for single-parent families is $1,000 larger than the cut for married families.
For more, here are all the messes that have approved stimulus checks for residents. Also, see if your state is offering gas rebate checks.
