Over the last few months, the expanded Child Tax Credit has helped millions of low- to moderate-income American families make ends meet. This money, which is issued each month to bank accounts and mailboxes by the IRS, has been an essential lifeline for households with children who were hit hard by the effects of the pandemic. But, that lifeline is scheduled to dry up very soon if lawmakers can’t come to an agreement on an extension of the program.
Without an extension, the enhanced Child Tax Credit benefits are slated to end in December. What that means is that just two more monthly tax credit payments are scheduled to be issued to households who qualify. But while the program is slated to end this year, there is still a chance that lawmakers could agree to extend the program past 2021. A proposal to extend the new tax credit benefits was included in President Joe Biden’s Build Back Better plan, and lawmakers are currently debating on whether or not that should happen.
If lawmakers cannot come to an agreement on an extension, it will be a huge hit for at-risk households, many of whom have come to rely on the monthly financial boosts to help pay for essential bills, like rent and food. In turn, this extra money has reduced financial anxiety for parents and lifted millions of kids out of poverty. And parents aren’t just using the money to cover rent — a new study shows that they’re also using the extra cash to cover child-related expenses, too. As we await the fate of the enhanced tax credit, here are three ways the recent Child Tax Credit payments have directly benefited children across the nation.
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1. The payments helped cover childcare expenses
Childcare is a routine — but extremely costly — expense for households with young children. About 55% of U.S. families spend at least $10,000 a year for childcare — and thanks to closures, capacity limitations, and other pandemic-related changes, some families’ childcare costs have skyrocketed over the last couple of years. Luckily, the tax credit money has helped at least …….