Missouri Republican Rep. Jason Smith speaks during the House Oversight and Accountability Committee’s impeachment inquiry hearing into U.S. President Joe Biden on September 28, 2023.
Jonathan Ernst | Reuters
When Congress seeks to elect the President Donald Trumpagenda, several Main tax provisions are all in limbo, including child tax credit Millions of families claim.
Trump’s 2017 Tax Cuts and Jobs Act (TCJA) temporarily raised the ceiling child tax credit Increases the subsidy from $1,000 to $2,000 per child under 17 and expands eligibility as it phases out for higher incomes. But if Congress doesn’t act, the higher benefits will resume after 2025, which could affect returns filed in 2027.
“The last thing families need is to see Washington cut the child tax credit in half,” House Ways and Means Committee Chairman Jason Smith, R-Mo., said at a meeting Tuesday. committee hearingwhich repeatedly addressed the issue of expiring tax breaks.
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In addition to raising the maximum benefit, the TCJA also limits the refundable portion of the child tax credit, which reduces benefits that low-income families do not pay taxes on.
“The child tax credit is upside down because it provides more benefits to high-income people than to low-income people,” said Chuck Marr, vice president for federal tax policy at the Center on Budget and Policy Priorities. previously told CNBC.
estimate 17 million children Children under 17 whose parents have lower incomes will not receive the full child tax credit by 2025, according to an analysis released in December by the Tax Policy Center.
Although people are worried federal budget deficitboth Democrats and Republicans recently supported extending the expiring child tax credit.
Members of the House of Representatives passed a bill in January 2024 bipartisan tax packageincluding an expansion of the child tax credit. This change is intended to increase access and retroactively increase the refundable portion through 2023 and may Trigger refund check.
While Senate Republicans in August blocked legislation Out of concerns about policy, they Express interest in future negotiations.
But with trillions in competing priorities and budget deficits growing, it’s unclear whether lawmakers will expand the increased child tax credit and whether its design will change going forward.
The U.S. Treasury Department reported on Tuesday that the three-month deficit for fiscal year 2025 surged to $710.9 billion in December, an increase of nearly 40% from the same period last year.
