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As expanded child tax credit expires, Dems push for extension

WASHINGTON — The last of six monthly payments issued to families this year under the federal government’s expansion of the child tax credit program will be disbursed on Wednesday, but a proposal to extend the program for another year hinges on Congress passing President Joe Biden’s $1.75 trillion social infrastructure package.

The parents and guardians of more than 3.5 million children in New York have qualified for payments of up to $300 a month under the expanded child tax credit, which was included in the coronavirus relief package passed by Congress in March. But with the credit set to expire at the end of the month, Senate Democrats are racing to get Biden’s overall social spending plan passed before Christmas, when lawmakers are scheduled to take a recess.

Senate Majority Leader Chuck Schumer (D-N.Y.), who has routinely lauded the expanded child tax credit, is facing resistance to reviving the program next year from Sen. Joe Manchin (D- W.Va.), a moderate Democrat from a conservative state, whose opposition to the plan could derail its passage in the 50-50 split Senate.

Manchin has argued in part that the expanded credit — which increased the existing Child Tax Credit for this year from $2,000 per child to $3,000 per child over the age of 6, and $3,600 for children under the age of 6 — is too costly. Biden and top members of his administration have argued the expansion has provided a lifeline to families reeling from the pandemic and lifted millions out of poverty.

"Millions of children who spent last Christmas in poverty will not bear that burden this holiday season," Biden said in a White House speech earlier this month.

On Monday, Biden spoke with Manchin by phone in his latest push to garner the senator’s support for the plan.

Treasury Secretary Janet Yellen, testifying before a Senate panel last month, said the expanded credit had reached the families of 61 million U.S. children since the program was launched in July.

"Food insecurity among families with children dropped 24% after the July payments, which is a profound economic and moral victory for the country," Yellen said.

Families had the option to receive half of their tax credit in the form of six monthly payments between July and December and the other half in a lump payment by April 2022, after filing their 2021 federal income taxes, or opting for one lump credit when filing their taxes.

Biden initially pushed for the expanded credit to be authorized until 2025, but House Democrats last month passed a version of his Build Back Better social spending plan that would expand the program only to the end of 2022. The move was seen as a compromise between progressive Democrats who had advocated for making the new credit permanent and moderate Democrats who were looking to bring the price tag of the package down.

The plan approved by House Democrats also seeks to lower the income criteria to qualify for the advance monthly payments. Currently most households earning $440,000 or less qualified for some level of the expanded credit and could opt into the monthly payments. Under the House plan, the advance payments would be limited to joint filers earning less than $150,000, heads of household earning below $112,500 and single filers earning less than $75,000.

The federal government has issued $77 billion in total monthly payments from July to November this year, according to the Treasury Department. That figure includes about $1 billion paid out to families in Nassau and Suffolk counties, according to figures provided by Schumer’s office.

Rebecca Sanin, president and chief executive of the Health and Welfare Council of Long Island, a nonprofit that connects health and human services agencies in the region, said the prospect of the expanded credit ending at the end of the month has sparked concern among many families still grappling with the impact of the pandemic.

"The destabilization of their lives is not over because society has opened back up," Sanin told Newsday. "They lost wages for months, in some cases people have lost jobs permanently or a business that they were building. The child tax credit has helped families — especially those that have really struggled — to be able to meet the basic needs of their families and the prospect of losing this credit is anxious-making for many."

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