There have been significant developments about the increase of the Child Tax Credit now taking place, and the tax season is just a month away. The Tax Relief for American Families and Workers Act of 2024 is a proposed piece of legislation that is now being actively worked on by both the House of Representatives and the Senate.
The purpose of this measure is to provide greater financial aid to families with children who are living on a lower income in the next year.
This legislative initiative outlines a strategic plan to enhance the Child Tax Credit by amplifying the maximum refundable amount allocated per child over the next three years. On February 15, the Internal Revenue Service (IRS) confirmed its close monitoring of the bill’s status, expressing a commitment to expedite implementation once the legislation receives approval.
The impact of this legislative move is substantial, particularly for low-income families. Following the bill’s official passage on Wednesday, a $78 billion bipartisan tax package was approved, encompassing the expansion of the Child Tax Credit.
2024 Child Tax Credit Boost
Policy experts anticipate widespread benefits, estimating that millions of children in low-income households will experience a positive financial shift. Upon enactment, eligible families can expect an average tax reduction of $680 for their 2023 taxes, as reported by the Urban-Brookings Tax Policy Center.
The American Rescue Plan, a pivotal factor in this development, has contributed to elevating the maximum tax break to $3,000 or $3,600 per child, a significant increase from the previous $2,000 limit. Notably, this augmented payment is set to be disbursed monthly to all qualifying families.
In precise terms, the 2024 Child Tax Credit expansion aims to benefit 16 million children residing in low-income households. While acknowledging that it may not cover all intended areas, lawmakers view this initiative as a substantial step in the right direction to provide crucial support for children across America.
