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Child Tax Credit: Could This ‘Stimulus Check’ Be Saved?

Joe Biden

The expanded child tax credit was simultaneously one of the great successes and great failures of the Biden presidency to date. 

The expanded credit, which included direct payments to most American families each year between July and December of 2021, was enacted in March of 2021 as part of the American Rescue Plan Act. According to multiple studies, the credit succeeded in delivering a dramatic decrease in child poverty. 

However, the credit was set to expire after one year, and the Build Back Better Act, a massive spending package that would have extended it by one year, failed to pass the Senate after Sen. Joe Manchin (D-WV) expressed his opposition, and the child tax credit reverted to its pre-2021 state, without the direct payments, at the start of 2022. As a result, the progress on reducing child poverty has been revised. 

The Inflation Reduction Act, a version of Build Back Better that did not include the credit, passed earlier this year. But Manchin’s continuing opposition, as well as rising inflation, kept the White House from revisiting the expanded child tax credit idea this year. There was talk at one point that a compromise could be reached between the child tax credit and the “child allowance” proposed in 2021 by Sen. Mitt Romney of Massachusetts, but such talks never got particularly far. 

That state of affairs left the Democrats with a great achievement, but unable to continue it, or, for that matter, to campaign on it. And while the Democrats gained a Senate seat in the midterms, theoretically making Manchin’s vote unnecessary, the party also lost control of the House of Representatives. (Sen. Kyrsten Sinema of Arizona has since left the Democratic Party to become an independent, although Sinema voted for the American Rescue Plan Act.) 

So one would think that the expanded child tax credit was dead. But now, there are talks to bring the credit back, albeit not quite in its original form. 

According to Politico, the White House has “privately signaled to Democrats that it would support a compromise deal to revive the expanded Child Tax Credit, even if it includes work requirements it once opposed.” 

The idea would be to pass it during the remaining two weeks of the lame-duck session, as part of a “year-end legislative package.” Manchin, in particular, had opposed the credit without work requirements. But the Biden Administration, since the beginning, has opposed applying such requirements to anti-poverty programs. 

It’s not clear what form any such deal would take, and Politico described it as a “long-shot deal.” One possibility is a bipartisan deal in which Democrats get the child tax credit, while Republicans receive corporate tax breaks. All would potentially be included in an omnibus spending deal at the end of the year. 

“President Biden strongly supports the Child Tax Credit expansion he signed into law,” the White House told Politico, adding that the president “welcomes a conversation with anyone — Democrat or Republican — who has tax relief ideas to help families and children.”

Meanwhile, the two parties announced a deal to pass a full-year government funding package, in order to avert a government shutdown. The appropriations chairs announced that the parties had “reached a bipartisan, bicameral framework that should allow us to finish an omnibus appropriations bill that can pass the House and Senate and be signed into law by the President.”

If a revived credit doesn’t pass by the end of the year, it would fall to the new Congress. The Hill looked at whether the issue will come up next year. 

“Democrats have been pitching a deal on the CTC in exchange for credits favored by big business, including write-offs for research and development as well as interest payments. While there’s pressure on Democrats to get something done before they lose control of the House, advocates say the issue won’t be going away any time soon,” The Hill said. 

Stephen Silver is a Senior Editor for 19FortyFive. He is an award-winning journalist, essayist and film critic, who is also a contributor to the Philadelphia Inquirer, the Jewish Telegraphic Agency, Broad Street Review and Splice Today. The co-founder of the Philadelphia Film Critics Circle, Stephen lives in suburban Philadelphia with his wife and two sons. Follow him on Twitter at @StephenSilver.

Written By

Stephen Silver is a journalist, essayist, and film critic, who is also a contributor to Philly Voice, Philadelphia Weekly, the Jewish Telegraphic Agency, Living Life Fearless, Backstage magazine, Broad Street Review, and Splice Today. The co-founder of the Philadelphia Film Critics Circle, Stephen lives in suburban Philadelphia with his wife and two sons. Follow him on Twitter at @StephenSilver.