The last of the Child Tax Credit payments for the year is scheduled to drop on December 15, and families are wondering what will happen next. Research studies said that millions of children could fall into poverty if the CTC payments are not extended into 2022. Congressional leaders continue to debate on the topic.
The advanced Child Tax Credit payments helped millions of families fight back poverty in the last six months. The $250 to $300 monthly payments served as an immediate financial relief for ongoing bills, which is especially helpful due to the economic price inflation. Unfortunately, the payments are about to end.
According to earlier reports, the Child Tax Credit program only allocated $3,600 for families with children under six and $3,000 for families with older dependents. Half of these payments were paid as advanced monthly payments, and the second half would be paid in one lump sum in 2022 after the recipients file their 2021 tax returns.
However, research studies emphasized that ending the Child Tax Credit program would be a mistake. They warned that millions could fall back into poverty because of this decision.
Child Tax Credit Payments: Why It Must be Extended
According to the Center on Budget and Policy Priorities (CBPP), per CNBC, almost 10 million children will be negatively impacted by the CTC ending. They would reportedly fall behind the poverty line, which could reverse any progress they made in the year. The researchers also estimated 27 million children who will receive less than what they are currently getting. Families will lose their budget for the children's school fees and other necessities.
On the flip side, if Child Tax Credit payments continue, children and their families will have some financial aid they could rely on. This will dramatically improve their lives and eventually promote the country's long-term economic prosperity by reducing overall child poverty.
Aside from continuing CTC payments, involved parties hope that the payment could maintain its $3,600 budget per child.
Child Tax Credit Extension Gets a Boost
To support the research findings that blatantly warn against America's poverty, 448 economists previously wrote an open letter to the Congressional leaders. They emphasized that CTC was a necessary program for the betterment of the American people. They estimate that CTC payments could reduce child poverty from 14.2 percent to 8.4 percent, roughly supporting around 4.3 million children.
Jacob Goldin, an assistant professor at Stanford Law School, commented that CTC was essential for the American economy. "It's very rare to find an issue where so many economists agree on everything. But there's just very, very strong evidence that providing extra financial assistance to kids growing up in low-income households yields big benefits in their lives," per CNBC.
As previously mentioned, Congressional leaders and Democrats are still locked on a debate about the CTC payments. Some lawmakers might be worried that a $100 billion CTC budget per year would be too costly. The situation is still progressing, so affected families are recommended to watch out for more updates in the coming days.