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Child tax credit payments begin to hit bank accounts on Thursday – News

Video Source: YouTube, CBS News

By Josh Boak

Child tax credits have always been an empty gesture for millions of parents like Tamika Daniel.

The situation changes when the first payment of $ 1,000 hits Daniel’s bank account on Thursday. And the dollar begins to flow into the pockets of more than 35 million families across the country. Daniel, the mother of four 35-year-olds, even has a tax credit until President Joe Biden expands the tax credit for a year as part of the $ 1.9 trillion coronavirus bailout package passed in March. I did not know.

Previously, only those who earned enough money to pay income tax could qualify for credit. Daniel lost his job for nearly a decade because his eldest son needed her for autism. So she made the payment for social security. And she had to live in Fairfield Court, a public housing project that would be a dead end on Interstate 64 as the freeway passes through the Virginia capital, Richmond.

But next year’s $ 1,000 monthly addition could be life-changing for Daniel, who is currently working as a community organizer for Richmond’s nonprofit. It helps to provide a deposit for the new apartment.

“It’s actually coming on time,” she said. “We’re doing a lot. This definitely helps reduce the load.”

Biden has withheld a new monthly payment of an average of $ 423 per family as a key to halving child poverty. But he also sets up a broader philosophical battle about the role of government and the responsibilities of parents.

The Democratic Party sees this as a groundbreaking program in line with the same policies as social security, saying it will lead to better adult outcomes that help economic growth. However, many Republicans warn that payments discourage parents from working and ultimately lead to long-term poverty.

Currently, about 15 million households receive full credit. Monthly payments are $ 300 per child under the age of 5 and $ 250 per child between the ages of 5 and 17. Payments will expire after a year, but Biden is pushing to extend it to at least 2025.

The president ultimately wants to make payments permanent — and it tests this first round of payments as to whether the government can improve the lives of families.

Biden will give a speech at the White House on Thursday to commemorate the first day of payments and invite beneficiaries to raise awareness and promote continuity of payments.

White House spokesman Jen Psaki said on Wednesday, “The president is striving to recover from a pandemic and recession, so to help people understand that this is a benefit to help them. I felt it was important to raise the number. “

Florida Republican Senator Marco Rubio, who successfully defended credit growth in 2017, said the Democratic Party’s plans were to qualify for payments for almost any family, with or without parents. There is a job that states that it will turn benefits into “anti-labor welfare checks.”

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“Biden’s plan is known by not only abandoning marriage incentives and work requirements, but also by sending cash payments to single parents without guaranteeing that a child support order will be established. It will destroy the child support enforcement system, “Rubio said. Wednesday’s statement.

Administrative authorities disputed those allegations. The Treasury estimates that 97% of tax credit recipients have wages or self-employed income, and the remaining 3% have grandparents or health problems. Officials who demanded anonymity to discuss internal analysis discourage poor people from working as co-filer credits begin to be phased out at $ 150,000 and jobs only give them more income. He said he would never do that.

Colorado Democratic Senator Michael Bennet said the problem was one of inequality. He said economic growth has benefited the top 10% of earners in recent decades, while families are suffering from rising housing, childcare and medical costs. He said his voters returning to Colorado were concerned that their children would be poorer than their predecessors and that it would require an increase in child tax credits.

“This is the most progressive change in US tax law to date,” Bennett told reporters.

Being a parent is a costly task. The Department of Agriculture estimates that it published such a report in 2017, and a typical family spends $ 233,610 to raise a child from birth to the age of 17. We are always facing a disadvantage. Family members in the top third of their income spend about $ 10,000 more per child per year than families in the bottom third.

Child tax credits were created in 1997 as a source of relief, but they are also a driving force for economic and racial inequality, as only federal tax-paying parents were eligible to pay the full amount. became. According to a 2020 academic study, about three-quarters of white and Asian children were eligible for full credit, but only about half of black and Hispanic children.

In the census district where Daniel lives in Richmond, the median household income is $ 14,725, almost one-fifth of the national median. Three out of four children live in poverty. For a typical parent with two children in that part of Richmond, the increased tax credit will increase their income by almost 41%.

Tax credits are as much about keeping the middle class as they are about lifting the poor.

Katie Stelka in Brookfield, Wisconsin was dismissed from her job as a purchaser of beauty and hair care products in the Kohl’s department store chain in September as the pandemic strengthened control of the country. She and her son, Oliver, 3, and Robert, 7, were forced to rely on her husband’s income as a retirement services consultant. She said the family had already struggled to pay for her husband’s kidney transplant and his ongoing treatment five years ago before she was fired.

Due to lack of work prospects, Stellka re-entered college in February to study social work. She got a new job last month as an assistant secretary general of the Nonprofit International Correctional Association. Now she needs day care again. That’s worth $ 1,000 a week for both kids.

All tax credit money will go to cover it, Stelka, 37 said.

“It will help a little now,” she said. “I’m paying for the school at my own expense. I’m paying for boys. Food and everything else is going up. I’m really grateful. The tide seems to be changing. I feel it. “


Associated Press writer Todd Richmond of Madison, Wisconsin contributed to this report.


Source: Associated Press, CBS News



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