The Internal Revenue Service (IRS) is sending out what may be the last monthly payment to parents today and for some taxpayers, it'll be a hefty amount of $1,500 or more.
The IRS has been sending out monthly payments to eligible parents since July to taxpayers who are eligible for the advanced Child Tax Credit. Congress's passage of the American Rescue Plan, a $1.9 trillion relief package, increased the amount parents receive for the Child Tax Credit and enabled them to receive half their allotted sum in monthly payments.
While many eligible taxpayers have been receiving the monthly payments since July, families who weren't receiving payments could receive half their allotted credit amount in December if they signed up on IRS.gov before November 15.
The American Rescue Plan increased the credit from $2,000 for any eligible child, to $3,600 for a child under 6 years old and $3,000 for eligible children between 6 and 17 years old. That broke down to monthly payments of $300 for children under 6 and $250 for all other eligible children.
A family that only started receiving payments in December would receive $1,800 for each eligible child under 6 and $1,500 for all other eligible children.
Families will claim the second half of the credit when they file their taxes next year, but some legislators are hoping to keep monthly payments going through 2022.
The Build Back Better Act, a social spending package, would continue the expanded Child Tax Credit for another year. It passed the House in November but is stalled in the Senate as legislators debate aspects of the bill.
Senator Joe Manchin, a Democrat from Virginia, and Republicans have criticized the price tag of the legislation. The Congressional Budget Office estimated the package would cost $5 trillion and add $3 trillion to the nation's debt, significantly higher than the $1.75 trillion price tag Speaker of the House Nancy Pelosi floated ahead of the House's passage of the bill.
Senator Ron Wyden, a Democrat from Oregon who is chair of the Senate Finance Committee, told reporters that the IRS advised Congress that they must pass the package by December 28 to ensure parents go out on time in mid-January. If passed after that date, payments could be delayed and if Congress doesn't pass the package in this session, which is set to adjourn in January, the package will have to be reintroduced.
During a press briefing on Thursday, Brian Deese, director of the National Economic Council, told reporters the Child Tax Credit is part of the reason the administration wants Build Back Better to be passed before the end of the year. He said it's doing "what we hoped it would do" by giving families "breathing room" and reducing poverty.
"We are confident we'll get Build Back Better passed," Deese said on Thursday. "Extending the Child Tax Credit is one of the many reasons we need to do that and need to do it as soon as possible."
