Bernie Sanders won’t give up on child tax credit extension

Two parents lying on their bed with their young children.

Image Source: Getty Images

Can the increased credit come back?

Most important points:

  • Last year, parents got a world of relief thanks to the improved Child Tax Deduction.
  • Although it has been off the table this year, Bernie Sanders is pushing for an extension.

In March 2021, the US bailout plan was signed into law at a time when unemployment was rampant. Not only did the massive waiver bill allow for a third round of stimulus checks, but it also increased the tax credit for children and changed the way it was paid.

The normal maximum value of the Child Tax Credit is $2,000 per child. The upgraded version increased that to $3,600 for children under the age of 6 and $3,000 for children aged 6 to 17. The upgraded version also included monthly installment payments of the balance held in recipients’ bank accounts from July to December 2021.

It was that extra money and those monthly payments that helped so many people build their savings and get by at a time when job losses were still high and the cost of living was starting to rise due to supply chain backlogs. But this year, with US consumers battling record inflation, there was no stimulus on the table. And the child tax credit has returned to its former $2,000 maximum value, with monthly installments no longer an option.

But one legislator isn’t giving up on the increased child tax credit. Vermont Senator Bernie Sanders still has it on his radar, and he’s not letting it go without a fight.

Parents need that lifeline

Studies have shown that the increased child tax credit has helped reduce child poverty rates and reduce food insecurity in families with children. But in the absence of that boost, much of the progress made in 2021 has already been reversed.

Meanwhile, inflation has soared this year, forcing consumers to loot their savings and build up credit card debt to cover the costs of essentials. And as we head into the start of a new school year, many parents will no doubt have difficulties trying to stock up on the things their kids need without any kind of help.

Bernie Sanders recognizes the hardships facing so many families, and recently announced plans to make a change to extend the child tax credit for the next five years. If successful, the credit will retain the maximum value of $3,600 per year, or $300 per month, which was in effect in 2021. Sanders plans to pay off the credit by increasing the top corporate tax rate from 21% to 28%.

Some states are stepping up

As Americans struggle with the lack of the increased child tax credit and federal stimulus checks, some states are sending residents rebates — an option that became available thanks to excess funds in their respective budgets. However, most states don’t offer stimulus, meaning consumers may have a hard time keeping it off until inflation cools.

In July the inflation rate decreased compared to June, which was encouraging. But the July share price was still remarkably high. And until inflation slows to a more noticeable degree, consumers may unfortunately find themselves in an ongoing battle.

Warning: The Highest Cash Back Card We’ve Seen Now Has 0% Intro APR Until Nearly 2024

Using the wrong credit or debit card can cost you a lot of money. Our expert loves this top pick, which has an intro APR of 0% until almost 2024, an insane cashback rate of up to 5%, all somehow with no annual fee.

In fact, this card is so good that our expert even uses it personally. Click here to read our full review for free and sign up in just 2 minutes.

Read our free review

Add a Comment

Your email address will not be published.