Monthly payments for parents coming soon under the American Rescue Plan
KILLEEN, Texas (KWTX) - As the $1.9 trillion pandemic relief package — dubbed the American Rescue Plan — heads to President Biden’s desk later this week, families with children could soon see significant monthly payments.
It is part of a significant expansion of the longstanding Child Tax Credit.
“It’s increasing the benefit level, and it’s also paying it out monthly, so beginning in July, many families are going to start seeing either checks or direct deposits of $250 a month per child,” said Megan Curran, a postdoctoral research scientist at Columbia University’s Center on Poverty & Social Policy.
The package calls for $250 per month per child between the ages of six and 17 through the remainder of the year.
It provides $300 per month per child under the age of six.
“Rather than waiting until once a year, you actually are going to see this showing up once a month, and families can count on it as a meaningful part of their household budget,” Curran told KWTX.
Individuals must make less than $75,000 per year to receive the full monthly check.
Couples must make less than $150,000 per year.
“The hope is that this will provide sort of a base level of support for low-income families and a nice supplement for middle class families,” said Chuck Marr, a senior director of federal tax policy at the Center on Budget and Policy Priorities.
Marr and Curran said the legislation will go a long way toward lifting children out of poverty.
“Expanding this but also coupling it with the other provisions of the American Rescue Plan — like unemployment benefits, stimulus checks, nutrition assistance — has the potential to pull 6 million children out of poverty in 2021, which actually represents cutting childhood poverty in half in just one year,” Curran said.
Marr said that some 3 million Texas children did not qualify for assistance under the previous Child Tax Credit system because their parents did not make enough money.
He said that this legislation will catch those children who previously fell through the cracks.
The program is only slated to last a year, but some lawmakers want to extend it further.
“If it’s made permanent, it’s a landmark, and it rises to the level of certain New Deal programs, certain Great Society programs and then again Obamacare,” Marr said.
“It is that substantial,” he added.
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