Child Tax Credit Monthly Payments to Begin Soon

WASHINGTON — If all goes as deliberate, the Treasury Department will start making a sequence of month-to-month funds in coming days to households with kids, setting a milestone in social coverage and intensifying a debate over whether or not to make the subsidies a everlasting a part of the American security internet.

With all however essentially the most prosperous households eligible to obtain up to $300 a month per youngster, the United States will be part of many different wealthy international locations that present a assured earnings for kids, a objective that has lengthy animated progressives. Experts estimate the funds will reduce youngster poverty by practically half, an achievement with no precedent.

But this system, created as a part of the stimulus invoice that Democrats handed over unified Republican opposition in March, expires in a 12 months, and the rollout might assist or hinder President Biden’s pledge to prolong it.

Immediate challenges loom. The authorities is unsure how to get the funds to thousands and thousands of hard-to-reach households, an issue that would undermine its poverty-fighting objectives. Opponents of the hassle will likely be expecting supply glitches, examples of waste or indicators that the cash erodes the need of some dad and mom to work.

But compared to past aid debates, opposition has so far been muted. A few conservatives support children’s subsidies, which might boost falling birthrates and allow more parents to raise children full-time. Senator Mitt Romney, Republican of Utah, has proposed a larger child benefit, though he would finance it by cutting other programs.

With Congress requiring payments to start just four months after the bill’s passage, the administration has scrambled to spread the word and assemble payment rosters.

Families that filed recent tax returns or received stimulus checks should get paid automatically. (Single parents with incomes up to $112,500 and married couples with incomes up to $150,000 are eligible for the full benefit.) But analysts say four to eight million low-income children may be missing from the lists, and drives are underway to get their parents to register online.

“Wherever you run into people — perfect strangers — just go on up and introduce yourself and tell them about the Child Tax Credit,” Vice President Kamala Harris said last month on what the White House called “Child Tax Credit Awareness Day.”

Among the needy, the program is eliciting a mixture of excitement, confusion and disbelief. Fresh EBT, a phone app for people who receive food stamps, found that 90 percent of its users knew of the benefit, but few understand how it works.

“Half say, ‘I’m really, really ready to get it,’’’ said Stacy Taylor, the head of policy and partnerships at Propel, the app’s creator. “The others are a mix of ‘I’m worried I haven’t taken the right steps’ or ‘I’m not sure I really believe it’s true.’”

But in West Monroe, a 90-minute drive away, Levi Sullivan, another low-income parent, described the program as wasteful and counterproductive. Mr. Sullivan, a pipeline worker, has been jobless for more than a year but argued the payments would increase the national debt and reward indolence.

“I’m a Christian believer — I rely on God more than I rely on the government,” he said.

With four children, Mr. Sullivan, who has gotten by on unemployment insurance, food stamps, and odd jobs, could collect $1,150 a month, but he is so skeptical of the program he went online to defer the payments and collect a lump sum next year. Otherwise, he fears that if he finds work he may have to pay the money back.

“Government assistance is a form of slavery,” he said. “Some people do need it, but then again, there’s some people that all they’re doing is living off the system.”

Progressives have sought a children’s income floor for at least a century. “No one can doubt that an adequate allowance should be granted for a mother who has children to care for,” wrote the economist and future Illinois senator Paul H. Douglas in 1925 as children’s benefits spread in Europe.

Four decades later, the Ford Foundation sponsored a conference to promote the idea in the United States. The meeting’s organizer, Eveline M. Burns, lamented the “shocking extent of childhood poverty” but acknowledged strong political opposition to the payments.

While hostility to unconditional cash aid peaked in the 1990s, multiple forces revived interest in children’s subsidies. Brain science showed the lasting impact of the formative years. Stagnant incomes brought worries about child-rearing costs into the middle class. More recently, racial protests have encouraged a broader look at social inequity.

An existing program, the Child Tax Credit, did offer a children’s subsidy of up to $2,000 a child. But since it was only available to families with sufficient earnings, the poorest third of children failed to fully qualify. By removing that earnings requirement and raising the amount, Democrats temporarily converted a tax break into a children’s income guarantee.

Analysts at Columbia University’s Center on Poverty and Social Policy say the new benefits will cut child poverty by 45 percent, a reduction about four times greater than ever achieved in a single year.

“Even if it only happens for a year, that’s a big deal,” said Irwin Garfinkel, a professor at the Columbia School of Social Work. “If it becomes permanent, it’s of equal importance to the Social Security Act — it’s that big.”

Getting the money to all eligible children may prove harder than it sounds. Some American children live with undocumented parents afraid to seek the aid. Others may live with relatives in unstable or shifting care.

Dozens of groups are trying to promote the program, including the Children’s Defense Fund, United Way and Common Sense Media, but many eligible families have already failed to collect stimulus checks, underscoring how difficult they are to reach. The legislation contained little money that could be used for outreach, leaving many groups trying to raise private donations to support their efforts.

The Rev. Starsky Wilson, president of the Children’s Defense Fund, praised the Biden administration for creating an online enrollment portal but warned, “we really need to be knocking on doors.”

Gene Sperling, the White House official overseeing the payments, said that even with some families hard to reach, deep cuts in poverty were assured.

“While we want to do everything possible to reach any missing children, the most dramatic impact on child poverty will happen automatically,” because the program will reach about 26 million children whose families are known but earned too little to fully benefit from the previous credit. “That will be huge.”

By delivering monthly payments, the program seeks to address the income swings that poor families frequently suffer. One unknown is how families will spend the money, with critics predicting waste and supporters saying parents know their children’s needs.

When Fresh EBT asked users about their spending plans, the answers differed from those about the stimulus checks. “We saw more responses specifically related to kids — school clothes, school supplies, a toddler bed,” Ms. Taylor said. “It tells me the framing of the benefit matters.”

There is evidence for that theory. When Britain renamed its “family allowance” a “child benefit” in the 1970s and paid mothers instead of fathers, families spent less on tobacco and men’s clothing and more on children’s clothing, pocket money, and toys.

“Calling something a child benefit frames the way families spend the money,” said Jane Waldfogel, a Columbia professor who studied the British program.

While the payments will greatly reduce poverty, most beneficiaries are not poor. Jennifer Werner and her husband had a household income of about $75,000 before she quit her job as a property manager in Las Vegas two years ago to care for her first child. Since then, she has used savings to extend her time as a stay-at-home mother.

Ms. Werner, 45, supports the one-year benefit but wants to see the results before deciding whether it should last. “When you have a child you realize they’re expensive — diapers, wipes, extra food,” she said. But she added “I don’t know where all that money’s coming from.”

She hopes the country can be fair both to taxpayers and to children whose parents work too hard to offer sufficient attention. “If the benefit helps parents nurture their kids, that would be a wonderful thing,” she said.

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