by Veronique de Rugy
The American Institute for Economic Research
The Wall Street Journal’s editors have written another great editorial, this time on the expansion of the child tax credit into a Universal Basic Income for children. Parents can now claim a maximum of $3,000 for those ages 6 to 17 and up and $3,600 for children under age 6, up from its previous $2,000 level. The expanded part of the credit begins to decrease 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 credit isn’t just bigger; it is also fully refundable, meaning that parents who don’t make enough money to pay the income tax will receive cash from the government in the full amount of the credit regardless of their income. There is also no work requirement attached to the benefit and the cash is distributed in monthly payments. These payments started in July and the Democrats want to expand them through 2025.