One of the White House’s main goals this year is to reduce child poverty by sending monthly checks to parents starting in July.
“We will lift half of America’s children out of poverty,” Vice President Kamala Harris said Friday, calling the expected political achievement her favorite thing about her job.
Reducing child poverty is not done, however. Since checks are technically tax credits, it’s up to the Internal Revenue Service to send the money, but the agency may have a hard time reaching some of the millions of people who do not file federal taxes.
To that end, Harris appeared at a Washington, DC, daycare to promote the expanded child tax credit that Congressional Democrats approved as part of the US bailout, and to announce a new “Awareness Day. to the child tax credit ”on June 21.
“I’m here to ask all of you, as leaders, to be a part of raising awareness of what has been designed to help people, to make sure they know it,” Harris told a group of people. ‘teachers and administrators of the child. Care center. The IRS is also hosting a promotional income tax credit awareness day.
The US bailout passed by Congress in March increased the child tax credit from $ 2,000 per child to $ 3,600 per child under 6 and to $ 3,000 per child under 18. And instead of just reducing people’s tax bills, the IRS will distribute the credit as a prepayment starting next month. The vast majority of households with children will receive payments of $ 250 or $ 300 per child.
Money for parents could drastically change the policy, offering a monthly allowance to poor and middle-class parents, similar to the type of child allowance that other rich countries have long offered to parents.
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About 12 million Americans did not file federal income tax in 2020 because there is no reporting obligation for people who do not earn enough income to owe federal tax. Up to 10% of children live in non-filing households which should be eligible for payment, according to an analysis of IRS data by the People’s Policy Project, a left-wing think tank.
The IRS has teamed up with the Social Security Administration to send coronavirus relief checks to many of them, but several million are still missing.
“The IRS has no way of reaching children in non-filing tax units and no one has produced a plausible story on how they will do it,” PPP founder Matt Bruenig written last month. “Filing taxes is complicated and the poorest of the poor cannot afford to pay a third-party preparer to do it for them. “
IRS Commissioner Chuck Rettig said this week at a Senate hearing that the IRS has partnered with more than 10,000 local organizations to raise awareness of the credit.
“Individuals don’t always go to IRS.gov to get their information, so we work with thousands and thousands of community organizations across the country to disseminate information,” Rettig said.
Representative Richard Neal (D-Mass.), One of the leading authors of child tax credit legislation, said on Friday that the IRS would create a new online portal this month where non- filers could enter their information in order to get the payments.
“These advance payments of this credit will ensure that families receive this crucial support when they need it most, while dramatically reducing child poverty,” said Neal.
But estimates of how much the new tax credit will reduce poverty take into account the total amount of the benefit. Parents will only receive half this year, since monthly payments start in July, and will receive a lump sum for previous months at tax time next year. And then the extended credit expires.
Democrats and President Biden have said they will pass legislation to extend credit until 2025, but have yet to introduce legislation to do so.
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