WHAT'S HAPPENING
WYDEN, SMITH ANNOUNCE AGREEMENT ON FRAMEWORK TO REESTABLISH CHILD TAX CREDIT
Senate Finance Committee Chairman Ron Wyden (D-Ore.) and House Ways and Means Committee Chairman Jason Smith (R-Mo.) announced a commonsense, bipartisan, bicameral tax framework that promotes the financial security of working families, boosts growth and American competitiveness, and strengthens communities and Main Street businesses.
WHERE CREDIT IS DUE: A rally for the child tax credit in December 2022 in Washington, DC; A proposed $80 billion package would temporarily expand the benefit, lifting 400,000 out of poverty entirely and make another 3 million less poor in its first year.
Senate Finance Committee Chairman Wyden said: “Fifteen million kids from low-income families will be better off as a result of this plan, and given today’s political climate, it’s a big deal to have this opportunity to pass pro-family policy that helps so many kids get ahead. At a time when so many people in Oregon and all across America are getting clobbered by rising rents and home prices, the improvements this plan makes to the Low-Income Housing Tax Credit will build more than 200,000 new affordable housing units. By incentivizing R&D, this plan is also going to promote innovation and help sharpen our economic competitiveness with China and the rest of the world. My goal remains to get this passed in time for families and businesses to benefit in this upcoming tax filing season, and I’m going to pull out all the stops to get that done.”
The deal would enhance refundable child tax credits in an attempt to provide relief to families that are struggling financially and those with multiple children. It would also lift the tax credit's $1,600 refundable cap and adjust it for inflation.
"American families will benefit from this bipartisan agreement that provides greater tax relief, strengthens Main Street businesses, boosts our competitiveness with China, and creates jobs." Ways and Means Chairman Smith said. "We even provide disaster relief and cut red tape for small businesses, while ending a COVID-era program that's costing taxpayers billions in fraud. This legislation locks in over $600 billion in proven pro-growth, pro America tax policies with key provisions that support over 21 million jobs. I look forward to working with my colleagues to pass this legislation." Learn more at waysandmeans.house.gov/category/press-releases
THE TAX RELIEF FOR AMERICAN FAMILIES AND WORKERS ACT OF 2024 : A BIPARTISAN BOOST TO FAMILIES
The plan, which will be introduced as The Tax Relief for American Families and Workers Act of 2024, supports working families with an enhanced Child Tax Credit:
- Expands access to child tax credit: phased increase to the refundable portion of the child tax credit for 2023, 2024, and 2025.
- Eliminates penalty for larger families: ensures the child tax credit phase-in is applied fairly to families with multiple children.
- One-year income lookback: creates flexibility for taxpayers to use either current- or prior-year income to calculate the child tax credit in 2024 or 2025, similar to bipartisan action taken six times in the past 15 years.
- Inflation relief: adjusts the tax credit for inflation starting in 2024.
- Helps families get back on their feet with disaster tax relief covering recent hurricanes, flooding, wildfires, and the Ohio rail disaster.
- Increases supply of low-income housing by enhancing the Low-Income Housing Tax Credit, a public-private partnership with a proven track record, with increased state allocations and a reduced tax-exempt bond financing requirement.
- Eliminates Fraud and Waste by Ending the Employee Retention Tax Credit Program
- Saves over $70 billion in taxpayer dollars by accelerating the deadline for filing backdated claims to January 31, 2024 under the COVID-era employee retention tax credit — a program hit by major cost overruns and fraud.