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Parents Are Already Preparing To Budget For The New Child Tax Payments.
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Parents Are Already Preparing To Budget For The New Child Tax Payments.


The IRS has informed millions of parents that they will soon receive monthly payments of up to $300 per child, and some have already made plans to use the funds.

Ally Rykiel of Chico, California, will receive $550 per month for her two children, ages 5 and 11, to spend on school supplies, clothes, and shoes they'll need before school starts in the fall, as well as taekwondo classes and swimming lessons that were previously a financial burden.

Rykiel, 33, prepares the family's taxes, so she was well aware that the child tax credit benefited her family even before Democrats dramatically expanded it as part of the American Rescue Plan, and she's grateful to receive the money in advance monthly payments rather than a lump sum at tax time.

“When you get a lump sum, you don’t tend to spend it as intentionally,” she explained, “whereas with a monthly amount, you can budget it a little better.”

Democrats raised the credit's value from $2,000 to $3,600 per child, made it more refundable so that families could receive the full amount in cash, and directed the IRS to pay the money in advance monthly installments through the rest of 2021.

The monthly payments are a massive undertaking that the IRS initially predicted would be impossible on such short notice, but the agency has now informed the vast majority of parents that payments will begin on July 15 unless they opt out.

In recent years, an increasing number of congressional Democrats have come around to the idea that the federal government should support parents and try to reduce child poverty with the kind of monthly payments that are typical in every other advanced country. Democrats seized the moment after Congress responded to the coronavirus pandemic with two rounds of direct payments to almost everyone in America.

I have no choice but to include it in [the budget] because there are no other options... We have been severely impacted by COVID.

New York-based LaFleur Duncan

“I think they realized, with the stimulus checks during the pandemic, that ‘People really like it when we help them,’” Rykiel explained.

LaFleur Duncan, a 53-year-old mother from Brooklyn, New York, said she has no choice but to budget in the child tax credit to cover day-to-day expenses for her 13-year-old son, who will receive $250 per month until December.

Duncan worked as a nanny in New York City for 30 years until the family she worked for moved away; finding nannying jobs has been difficult, she said, and unemployment insurance is only temporary. Her son and husband both contracted COVID-19 in the last year, and her husband lost his job; he has since been reinstated, but only on a part-time basis.

“I have to put it in [the budget] because there is nothing else,” Duncan explained. “I have a 13-year-old I have to feed, and he’s starting high school in September, and I have to budget to buy clothes for him because we have been hit so hard by COVID.”

“They grow out of their clothes so quickly,” she explained, “there’s all this stuff we have to plan for.”

The child tax credit will go a long way toward alleviating child poverty in the United States if the government can reach America's poorest families; Democrats claim that if fully implemented, the tax credit will cut child poverty in half.

Democrats expanded the benefit for one year in the American Rescue Plan, but President Joe Biden, who originally supported making it permanent, has proposed a four-year extension. The proposal will be included in the second half of Democrats’ infrastructure push, which will address what they call “human infrastructure,” such as child care and education.

The money hasn't even arrived in Marla Snead's bank account, and she's already concerned about what it will mean for her daughter when the benefit runs out at the end of the year.

I'm not sure why this won't be until the child is 18, rather than at the end of the year.

West Virginian Marla Snead

Snead, a 52-year-old single mother of a 14-year-old from Chesapeake, West Virginia, has been on Social Security Disability Insurance since 2008. She's had two failed back surgeries and battled cancer, and there are days when she can't walk. Her expenses, which include a car payment, rent, utilities, phone, and internet, account for roughly three-quarters of her income.

Her ex-husband hasn't paid her child support in years.

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“I don’t understand why this isn’t going to be until the child is 18 instead of the end of the year,” Snead said, noting that “each year as they get older, their needs become more.”

She intends to use the tax credit money solely for her daughter's needs, such as food, school supplies, books, and feminine hygiene products.

“Right now, I literally cannot afford a package of loose-leaf paper for her.”

And, according to Snead, she hopes there will be enough left over for a few treats throughout the summer.

“She adores that Korean K-pop group BTS,” Snead explained. “Right now, they have a BTS McDonald’s meal, which is nothing more than a chicken nugget meal, but it’s them and she wants that, but I don’t have McDonald’s money.”

Are you a parent who has already budgeted for the child tax credit? If you don't file taxes, have you signed up for the child tax credit? Tell us about it by emailing [email protected] and including your phone number if you're willing to be interviewed.

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