The cost of childcare is often underestimated. It can easily run into thousands each month for a single child, leading many mothers to leave the workforce. The pandemic exacerbated this issue, resulting in an unprecedented number of mothers exiting their jobs, highlighting the urgent need for solutions.
Enter the American Rescue Plan, a $1.9 trillion economic relief initiative aimed at helping the nation recover from the severe impacts of COVID-19. A key feature of this plan is the largest Child Tax Credit in history, benefiting families more than ever and providing crucial support during tough times.
Details of the Child Tax Credit
The Child Tax Credit increased from $2,000 to $3,000 per child for those over six years old and from $2,000 to $3,600 for younger children. Additionally, the age limit for eligible children was raised from 16 to 17. Families can now receive up to half of this credit in advance monthly payments—$250 or $300 per child—starting July 15 through December 2021.
Eligible households can receive the full credit if they earn up to $150,000 for couples or $112,500 for single parents (Head of Household). Even those with no income or who haven’t filed a recent tax return can access advance Child Tax Credit payments by completing the Non-Filer tool on IRS.gov. For those who have filed tax returns for 2019 or 2020 or signed up for previous stimulus payments, the money will be disbursed automatically.
Real Stories from Families
If you have children aged 17 and under, you likely have received or will receive financial support from the federal government. After a year filled with unexpected challenges, the Child Tax Credit is a vital lifeline for families struggling to make ends meet.
Daniel Carter, a single father of two, told Vox, “I was down to my last $60 and unsure how I’d manage for two weeks when I got a text saying $500 was deposited into my account. The Child Tax Credit saved me. I can’t express how relieved I was.” Similarly, Jennifer Lee, a married mother of two, shared with AP News, “Every bit helps. I’m covering school expenses out-of-pocket. Prices for food and essentials have skyrocketed. We’re genuinely grateful. It feels like things are finally improving.”
The Impact of the Child Tax Credit
According to NPR, Columbia University’s Center on Poverty and Social Policy estimates that the American Rescue Plan could lift 5 million children out of poverty thanks to the expanded child tax credit and other provisions. Notably, not a single Republican supported the bill, with many on the right labeling it as a “socialist” initiative that could lead to financial ruin for America.
However, the reality is that most parents aren’t exploiting these funds; they’re simply trying to cover everyday expenses associated with raising children in a society where many feel torn between employment and childcare duties. Yet, some critics argue that the child tax credit is unjust or favors those with children over those without. (Please excuse my eye roll).
In truth, the Child Tax Credit isn’t merely a handout or a way for low-income parents to avoid work; it’s a tax credit that families have been claiming since it was introduced in the Taxpayer Relief Act of 1997. Sarah Thompson told CBS News, “Some may dismiss it as a handout, but I don’t see how they can think that when we’re working adults. I don’t know any parent who wouldn’t appreciate an extra $250 for their child.”
Conclusion
In our current economic climate, countless families are struggling. Allowing families to receive an advance on a tax credit, resulting in $250 or $300 per child for the next six months, is the least the government can do to aid families in getting back on their feet. Anyone who disagrees should take a moment to reflect on their own privileges.
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In summary, the expanded Child Tax Credit is a crucial lifeline for families navigating financial challenges, especially in the wake of the pandemic. Despite criticism, this initiative has the potential to uplift millions of children out of poverty, making it a necessary support in today’s economic landscape.