Democrats propose tax credit of up to $3,600 per child in Joe Biden’s COVID-19 relief plan

WASHINGTON – Congressional Democrats will propose to give families up to $3,600 per child this year as part of President Joe Biden’s COVID-19 relief plan.

The proposal, part of a 22-page draft obtained by USA TODAY ahead of the legislation’s public release, would expand the Child Tax Credit to up to $3,600 for children up to 6 years old, or $3,000 for children up to age 17. The credit would be split up into monthly payments to families from the federal government.

The credit would start to phase out for couples earning $150,000, or $75,000 for individuals. Under current tax law, the child tax credit is $2,000 per child and is not distributed monthly. The new proposal was first reported by the Washington Post

Democrats say the credit will be a lifeline to families affected by the COVID-19-induced economic recession and will help lift children out of poverty.

“The pandemic is driving families deeper and deeper into poverty, and it’s devastating. We are making the Child Tax Credit more generous, more accessible, and by paying it out monthly, this money is going to be the difference in a roof over someone’s head or food on their table,” said Rep. Richard Neal, D-Mass., the chairman of the tax-writing House Ways and Means Committee.

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It is unclear if the legislation will be included in the final version of Biden’s relief plan because of the procedure called reconciliation Democrats are using to pass the bill. Reconciliation allows Democrats to more easily pass the legislation through the Senate but places certain constraints on the provisions allowed in the final bill.

Biden had proposed the credit in his relief plan, but Democrats are just beginning to write the plan into a bill that could become law. Democrats passed legislation last week allowing them to begin drafting the text of Biden’s relief plan, and congressional committees are set to begin work this week on writing the plan. House Speaker Nancy Pelosi, D-Calif., predicted the House would pass the bill by the end of the month, and that the Senate would pass it by mid-March.

The expansion of the credit could also face resistance from Senate Republicans, but Democrats point to similar proposals introduced by Republicans. Sen. Mitt Romney, R-Utah, introduced a plan last week to provide a $350 per child monthly cash benefit for families with children under 6 years old, or $250 per month for children 17 and younger. Romney’s proposal was paid for by eliminating other federal programs like the federal deduction for state and local taxes and Temporary Assistance for Needy Families, a welfare program.

Some Democrats are pushing for legislation to make the tax credit permanent beyond the one year proposed in Biden’s plan, a proposal costing about $117 billion, Rep. Suzan DelBene, D-Wash., told reporters in a Monday press conference.

Rep. Rosa DeLauro, D-R.I., who chairs the powerful House Appropriations Committee, told reporters making the credit permanent could achieve the “highest success of child poverty reduction.”

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Rep. Ritchie Torres, D-N.Y.., said it could be “transformative” for districts like his with high poverty.

“It’s hard to imagine a more powerful stimulus for our economy, a more powerful stabilizer for families than a permanently expanded child tax credit,” he said.

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