Billions in child credit tax return

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The Biden administration wants families with children to know there’s an estimated $193 billion waiting for them — all they have to do is file their taxes to claim it.

That estimated total is what’s left of the expanded child tax credit, and the administration fears that some of those who need the help the most are the least likely to get what’s owed to them.

President Joe Biden has increased payments and expanded who is eligible under his coronavirus relief package. While most families already received half the credit in monthly payments last year, they will lose the remaining balance unless they file their taxes.

Vice President Kamala Harris, Treasury Secretary Janet Yellen and White House senior adviser Gene Sperling hosted a virtual event on Tuesday to encourage people to send their tax forms to the IRS, including those whose incomes are so weak that they might not have filed traditionally.

Harris said families should go to childtaxcredit.gov to check their eligibility. The tax filing deadline is April 18.

“The truth is, there are people across our country who are working hard every day who are still struggling to get by and it shouldn’t be that way in our country,” Harris said. “You still have to file your taxes. This is the only way to receive the second half of what is due to you.

The public push comes at a critical time for the US economy and the child tax credit program. Inflation hits its highest level in nearly 40 years, meaning extra credit money will help offset the costs of food, gas and other goods as the U.S. still pulls out of the pandemic. But efforts to renew the expanded appropriations for another year have stalled in the Senate, making it important for advocates to demonstrate how the appropriations have reduced child poverty by about 40%.

Yellen said research suggests cash is among the most promising policies for tackling poverty, pointing to recent research suggesting cash was linked to higher brain activity in babies of poor mothers.

“It is very unequivocal that these policies are improving the lives of millions of people and, in doing so, improving the country,” Yellen said.

Several lawmakers and nonprofits are involved in raising awareness, and there are plans to hold events in all 50 states and Puerto Rico during tax filing season. Yellen noted that nonprofits are often more successful in reaching poorer populations.

As part of the $1.9 trillion coronavirus relief package, Biden increased child tax credits to $3,600 a year for each child age 5 or younger and $3,000 for those aged 6 to 17. The government started sending the payments on a monthly basis from last July, meaning there are six months worth of payments waiting to be claimed by people filing their taxes.

The administration estimates that about 58 million households would qualify for the credit, which averages $3,300 and could be used to offset an existing tax bill or be refunded.

Childless workers could also get extra help this tax season if they file. The relief package nearly tripled the earned income tax credit for workers without dependent children, meaning 17 million people could receive credits worth $1,500.

The expansion of child tax credits was seen as reducing child poverty to its lowest level on record. A recent analysis by researchers at Washington University in St. Louis and Appalachian State University found no evidence that monthly payments caused parents to stop working. But critics say making the credits larger and fully refundable – which ensures poorer families are entitled to the full benefit – leads to fewer people in gainful employment and creates a drag on the economy.

Biden has pushed to continue expanding the child tax for another year as part of his “Build Back Better” agenda. But in an evenly divided Senate, West Virginia Democrat Joe Manchin opposed expanding credit, fearing its price would increase the deficit and worsen inflation.

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