Here’s what needs to happen for child tax credit payments to continue in 2022
(WJW) – The last child tax credit payment of 2021 is coming into the accounts this week.
As it stands, payments will not continue until 2022. However, if the Build Back Better law passes the Senate, it will extend child tax credits for direct payments into 2022. The House approved a first draft last month.
The Biden administration wants the bill to be approved before Christmas so families can plan that money for the New Year.
“Our point is that the child tax credit is a really fundamental and important support for families and we should extend it because it does what we hoped it would do,” said Brian Deese, director of the Council. national economy in a Newsweek article last week. .
The potential to pass the 10-year $ 2 trillion package took a hit on Friday when the government announced that inflation had pushed prices up last month to an annual rate of 6.9%, the highest in 39 years.
Senate Majority Leader Chuck Schumer, DN.Y., did not say when he would call for a vote.
Here is the content of the bill as it currently stands:
FAMILY AND CHILD CARE
– Eligible workers would receive up to four weeks of paid leave to reimburse them for time spent caring for a new child or other family members or recovering from illness. Biden originally proposed 12 weeks of paid family leave.
– Federal grants would ensure that parents earning up to 250% of a state’s median income would pay no more than 7% of their income for child care. Parents must be working, looking for a job, attending school, or have a medical condition to be eligible.
– A universal preschool would be in place for all 3- and 4-year-olds, and child care subsidies would be provided to the poorest and middle-income Americans. But the programs are only funded for six years.
– $ 40 billion would be devoted to higher education and workforce development. This includes increasing the size of the Pell Grants and funding historically black colleges and universities as well as institutions that largely serve Hispanic students or tribal communities.
ENVIRONMENT / CLIMATE CHANGE
– Tax credits for clean energy would benefit from funding of $ 320 billion. These 10-year credits would help businesses and homeowners switch to renewable energy sources for electricity, vehicles and manufacturing.
– $ 105 billion would be spent to improve the capacity of communities to withstand extreme weather events, which have been made worse by climate change. The funding would also create a Civilian Climate Corps that focuses on conserving public lands and building the resilience of communities to floods, droughts and other weather emergencies.
– $ 110 billion would help develop new national supply chains and develop new solar and battery technologies. Support would also be given to the existing steel, cement and aluminum industries.
– Medicare would be extended to cover hearing aids, which would cost around $ 35 billion over 10 years.
– Medicare Part D reimbursable expenses for older Americans would be capped at $ 2,000 per year and the price of insulin reduced to $ 35 per dose at most.
– A Medicare drug negotiation program would be put in place. Each year, the Secretary of Health and Human Services would identify 100 brand name drugs with no price competition and from that list, he would negotiate the price of up to 10 drugs in 2025, 15 in 2026 and 2027, and 20 thereafter.
– Expanded tax credits to help cover insurance premiums under the Affordable Care Act would be extended until 2025. The White House says this would help 3 million uninsured people get coverage.
– $ 150 billion would go to a Medicaid program that supports home health care, helps clear a backlog and improves working conditions.
– $ 90 billion would go towards investments that would include funding for maternal health, community violence initiatives, disadvantaged farmers, nutrition and pandemic preparedness.
– $ 150 billion would be devoted to affordable housing with the goal of building more than one million new rental and single-family homes. The aim would be to reduce price pressures by providing rental and down payment assistance.
– An expanded child tax credit would continue for another year. As part of a COVID relief bill, Democrats increased the tax credit to $ 3,000 per child aged 6 to 17 and to $ 3,600 per child aged 5 and under. Households earning up to $ 150,000 per year get the credit paid to them on a monthly basis.
– The expanded earned income tax credit that goes to 17 million low-wage, childless workers would be maintained for one year.
– Biden’s plan strengthens the IRS to improve collections and close the gap between taxes owed and taxes paid.
– A minimum income tax of 15% would be applied to large corporations. The United States would also be aligned with an agreement reached by more than 100 countries aimed at dissuading multinational companies from hiding their profits in low-tax countries.
– The bill would create a new surtax on multimillionaires and billionaires and close a provision that allows some high net worth taxpayers to avoid paying the 3.8% Medicare tax on their income.
– A limit of $ 10,000 on national and local tax deductions would be raised to $ 80,000. Tax analysts say the change would largely benefit higher-income households.
– A 1% surtax would be imposed on corporate share buybacks, which Democrats say are often used by business executives to improve their finances rather than investing in the company and its workers.
– Those who entered the United States before January 2, 2011 and have resided continuously since then would be eligible for renewable parole for five years after paying administrative fees and completing security and background checks. Parole status gives recipients permission to travel and work in the United States and considers them eligible for a Real ID-compliant driver’s license or state ID card.
The Associated Press contributed to this report.
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