Many of our nation’s families have been seeing the effects of financial stresses and concerns since the COVID-19 pandemic gripped the world over a year and a half ago. Since the start of the unprecedented pandemic, American households have found themselves facing hardships; many of these are the result of COVID-19 related lockdowns and job insecurities. Multiple programs have been implemented in an effort to combat these challenges faced by many across the nation. Programs such as the current child tax credit program and the economic stimulus packages.
These stimulus packages were ones that households received throughout the end of 2020 and into 2021.
Earlier this year, the Biden administration announced another program designed to offset financial strains American households may be facing. As part of a program called the Affordable Care Act, the administration began issuing regular child tax credit payments to households across the nation.
Will the Child Tax Credit Continue Into 2025?
Initially, the child tax credit payments were designed to be sent out to households across the country from July through December in 2021. Each payment included $300 per child under the age of six; and $250 for children ages six to seventeen. However, recent reports have stated that this program may continue.
This suggestion comes in an extended Affordable Care Act proposal. This proposal includes the $3.5 million child tax credit expansion.
American families who qualify for this Affordable Care Act (ACA) child tax credit started to see their first payments roll in this summer. The payments will cease at the end of the year if the program is not renewed.
It is important to note that this proposal to extend the child tax credit is simply in the beginning stages. The bill is currently working through Congress.
The Proposal Is Part Of A Larger Package
The child tax credit was born out of a $1.9 trillion COVID-19 relief package that passed earlier this year. The package included the payments as well as a variety of other ACA-related programs.
The proposal also suggests applying a new system to how businesses are taxed. According to the proposal, businesses would no longer be paying a flat corporate rate of twenty-one percent. Instead, the proposal suggests that corporations pay an eighteen percent tax rate on the first $400,000 worth of taxable income. After that, the corporations would then be looking at a twenty-one percent tax on income up to $5 million. The tax rate would increase to twenty-six and a half percent on any income above the $5 million.
The tax changes proposed in the bill would likely bring in an income of $964 billion from the corporate tax increases; and about $1 trillion from the high-income tax increases.