Lawmakers Finalize Bipartisan Child Tax Credit Deal

WASHINGTON — A bipartisan team of lawmakers on Tuesday announced that they had finalized a deal to restore business tax breaks and expand a credit that gives millions of parents refunds at tax time.

Senate Finance Committee Chair Ron Wyden (D-Ore.) and House Ways and Means Committee Chair Jason Smith (R-Mo.) unveiled the details of their agreement in a joint press release.

The proposed expansion of the child tax credit falls far short of a policy that Democrats enacted in 2021 as part of the American Rescue Plan, which briefly provided advance monthly refunds worth as much as $300 per child. But Tuesday’s announcement reflects the reality of a divided government.

“Fifteen million kids from low-income families will be better off as a result of this plan, and given today’s miserable political climate, it’s a big deal to have this opportunity to pass pro-family policy that helps so many kids get ahead,” Wyden said.

Smith said that the proposal aids families, but he emphasized that it also “strengthens Main Street businesses, boosts our competitiveness with China, and creates jobs.”

Households that already benefit from the child tax credit would be able to receive a larger portion of the credit as cash refunds, some families with multiple children would get more money per child, and families would have flexibility to base their eligibility on the most advantageous recent tax year.

But the proposal would not greatly expand the $2,000 value of the credit, and it would retain the current requirement that families earn at least $2,500 to qualify — meaning the poorest households would not benefit.

Rep. Rosa DeLauro (D-Conn.), a longtime champion of expanding the child tax credit, said last week that she would not support