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Enhanced Child Tax Credit Could Help You Save at Least $10,000 Per Year, Biden Says

Enhanced Child Tax Credit
Washington, D.C.-area residents Cara Baldari and her 9-month-old daughter Evie (left) and Sarah Orrin-Vipond and her 8-month-old son Otto (right), join a rally in front of the U.S. Capitol on Dec. 13, 2021. (Photo by Alex Wong via Getty Images)

A recent budget plan revealed by President Joe Biden showed that the enhanced child tax credit should be reinstated at the $3,600 level in 2021. 

The US Sun mentioned that the federal child tax credit, which had temporarily risen to $3,600 due to the pandemic, was reduced to $2,000 per kid last year. 

Families in America now have some optimism that the increased credit will return. 

The child tax credit would have a maximum value of $3,000 for children aged six and older and $3,600 for children under the age of six under the plan. 

Enhanced Child Tax Credit

This is a representation showing an “Enhanced” Child Tax Credit document. (Photo by Canva)

Enhanced Child Tax Credit: Biden Says CTC Should Be Increased

In a budget address on Thursday, Biden claimed that the enhanced child tax credit, which now includes monthly payments of up to $300 per kid, had contributed to the lowest level of poverty in American history, which has been reduced in half. 

CNBC said that several policy recommendations in the president’s budget that would support both people and families would go along with the decision to enlarge the credit. 

This entails returning the child tax credit to its “full” levels from 2021, with households getting $3,600 for each kid under the age of 6 and $3,000 for each child above the age of 6. 

ALSO READ: Understanding the First-Time Home Buyer Tax Credit: A Guide for New Home Buyers

How CTC Helped

According to studies obtained by GoBankingRates, the child tax credit provided during the pandemic contributed to a 25% decrease in child poverty. 

To keep low-paid employees out of poverty, the earned income tax credit would be permanently increased for childless workers. 

The proposed enhanced child tax credit stipulates that all employees would get seven paid sick days in addition to 12 weeks of paid family and medical leave. Moreover, it strives to increase access to free preschool and reasonably priced daycare. 

Also, the budget proposes to increase Medicaid home and community-based services, enabling elderly and handicapped people to remain in their own homes and relieving family caregivers and in-home care providers.

RELATED ARTICLE: Nebraska Homeowners to Receive Payments from the Property Tax Relief Program: Refundable Income Tax Credit

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