IRS Prepares to Send Monthly Checks to Families Following Child Tax Credit Expansion

The Internal Revenue Service (IRS) is preparing to send millions of families monthly checks beginning July 15 as a part of the expanded child tax credits, which Congress approved in March.

According to The Wall Street Journal, around 39 million families will “receive up to $250 a month per child between age 6 and 17 and up to $300 per child under age 6.”

The expanded credits, unless extended, will expire this December. But until then, monthly checks will be sent to families totaling up to $1,800 per child divvied up over the course of six months.

The expanded credits come as a part of the American Rescue Plan, which Congress passed in March. The plan increased the amount of tax credits that families could receive “from $2,000 per child to $3,000 for those age 6 to 17 and to $3,600 under age 6.”

So, how much can a family earn while still qualifying for the credits?

“The expanded part of the credit begins shrinking as income rises above $75,000 for individuals, $112,500 for heads of household and $150,000 for married couples. The $2,000 credit starts phasing out when income reaches $200,000 for individuals and $400,000 for married couples,” The WSJ reports.

The monthly payments from the IRS are a new feature of the program after Congress ordered the agency to turn the tax credits that had been claimed as a lump-sum on yearly refunds into monthly checks, deposited either directly into qualifying families bank accounts or sent via paper checks through the mail.

Of note, the plan also made child tax credits fully refundable, which means that families who do not pay any taxes will still qualify for the entire amount for each eligible child.

The monthly payments will decrease the amount of tax credits that families can receive on their tax refund come 2022. “Parents will get half of the credit’s full value over the course of the second half of 2021, shrinking the tax refund they would otherwise get in early 2022,” The WSJ notes.

Now, there are positive and negative aspects to the payments, as is usually the case with any law. Many families, especially those who are low-income, will likely be exceedingly grateful for the payments.

However, the monthly payments are now just one of an ever-increasing number of benefits that those struggling financially can claim. Some of these benefit programs include the Supplemental Nutrition Assistance Program (SNAP), unemployment benefits (which were greatly expanded during the pandemic), Medicaid, the Children’s Health Insurance Program (CHIP), Housing Assistance, and Temporary Assistance for Needy Families (TANF) among others.

According to a lengthy report from The Heritage Foundation, the United States’ spending on welfare programs in 2016 totaled “$1.1 trillion… federal expenditures accounted for $829 billion (74 percent), and state expenditures accounted for $297 billion (26 percent).”

“Between 1965 and 2016, total means-tested welfare spending by federal and state governments cost taxpayers roughly $27.8 trillion in constant FY 2016 dollars,” the report notes.

With the national debt standing at $28,297,286,741,819 as of publication, future generations will bear the cost of today’s profligate spending.

In a statement to The Daily Citizen, President Jim Daly elucidated Focus on the Family’s position on the expanded tax credits. “We generally favor policies and legislation that allows families to keep more of their money, but conditioning taxpayers to rely on regular monthly payments from the government is deeply concerning to us,” Daly said.

No matter how much, or how little, the government provides for low-income families, individual Christians should remember that they have a responsibility to help those in need.

“Jesus said to him, ‘If you would be perfect, go, sell what you possess and give to the poor, and you will have treasure in heaven; and come, follow me’” (Matthew 19:21).

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