A number of recent articles have suggested that the expanded child tax credit provided in 2021 has now expired. However, that only applies to the monthly payout of the expanded payments legislated for 2021. Democrats’ March 2021 American Rescue Plan provided for those monthly payments between July and December 2021 — but they constitute only half of the expanded benefits payable under that policy.

The second half of that law’s temporary expansion — which includes making millions more recipients eligible for larger payments — is about to be paid out as Americans file their annual income tax forms in the coming weeks. A group of Democratic Senators admitted as much in a letter they sent to the president last week, noting that the expanded payments “have helped families cope with pandemic-induced price increases — and will continue to do so as families receive the second half of their expanded tax credit this spring.”

Here is what the program’s estimated payouts — both the part
associated with the monthly payments made between July and December and the
part resulting from coming annual tax filings — look like:

As the chart displays, more is about to be paid out in the coming weeks than was paid out during the entire prior period of monthly payments. But you would never know that based on some media accounts’ recent analysis. For example, a January 27 Politico article indelicately titled “Biden’s signature legislation expired. Recipients are wondering: WTF happened?” repeatedly suggests that these expanded benefits have already ended:

• “The extended child tax credit was a lifeline for many. Now it’s gone . . . ”
• “The payments Williams and millions of other families leaned on ended in December . . . ”
• “ . . . she grappled with the loss of that extra aid . . . ”
• “. . . the last of the payments were made on Dec. 15 and the program effectively expired . . . ”
• “ . . . dismay among those who were relying on the extended child tax credit and no longer are receiving it . . . ”
• “ . . . the halting of the child tax credit payments means no spare cash . . . ”

The closest the article comes to admitting the large payouts ahead — which in effect will be six times each of the recent monthly payments for millions of recipients — was an oblique reference to “later this year, as families struggling with the same pandemic begin feeling the full absence of the extended child tax credit.”

In the meantime, as they file their taxes, more Americans than ever before are about to receive what collectively amounts to the largest child tax credit payments in history — without further legislation. And that’s without counting the $93 billion already paid out in monthly installments, as the chart above displays.

In discussing a possible extension of the 2021 expansion, President Biden recently described that as a policy “I’m not sure I can get in the package,” referring to a potential revival of the now-stalled Build Back Better bill. The Politico article called that “an admission that recipients across the nation said they interpreted as the White House effectively giving up on the policy.” But that admission shouldn’t allow the media and policymakers to simply ignore the record payments about to be made to millions of recipients — ironically due to the very same temporary policy they describe as “expired.”

The post The ‘expired’ child tax credit expansion continues to result in record payments appeared first on American Enterprise Institute – AEI.