Some Families Opting Out of New Child Tax Credit

Parents with children 17 and younger have started receiving a boost from the government in their bank accounts as part of the coronavirus relief package. For some families, the money could add up quickly: The measure provides for monthly payments of $300 for each child 5 and younger, and $250 for those ages 6 to 17, per the AP. This expansion of the child tax credit is set to expire after a year, though President Biden says he would like to extend it through 2025, if not longer. The vast majority of families are eligible, with the amount of aid tapering off for solo incomes of $75,000 and joint incomes of $150,000.

• Before cashing in, parents might want to make sure the extra money doesn't come back to haunt them, notes the Wall Street Journal. In fact, about 1 million families already have opted out. "The IRS is making the payments based on income shown on 2020 or sometimes 2019 returns," writes Laura Saunders. "So families whose income has risen or who have had other changes could have to pay back some or all of the prepayments on their 2021 tax returns."

• Biden, meanwhile, called the relief payments transformative on Thursday, reports the Hill. “It’s a reflection of our belief that the people of this country who need a tax cut aren’t the folks at the top—they’ve gotten plenty of tax cuts, they’re doing fine—but it’s the people in the middle, the folks who are struggling or who are just looking for a little bit of, as my dad would say, a little breathing room," said Biden at the White House.
• The Washington Post collects this quote from a historian of welfare policy at Endicott College: “This is the biggest anti-poverty effort since Lyndon B. Johnson’s war on poverty,” says Joshua McCabe. “This is a once-in-a-longtime chance to significantly reduce child poverty.”

(More child tax credit stories.)