Manchin is putting Biden's child tax credit on the chopping block, digging in on who should qualify

President Joe Biden. Manuel Balce Ceneta / AP
The Democrats want to extend the child allowance under their social spending law.
Some people have made a move to make work compulsory, which could exclude many families already receiving the cash benefit.
Democrats can stop high earners from receiving the money and use it for those most in need.
On Friday, cash flowed into the bank accounts of around 36 million families in America. It is the fourth round of direct payments under the Democrats' revised Child Tax Credit, which is part of President Joe Biden's stimulus bill.
Biden argues that the cash benefit is a turning point for American families, strengthening their ability to bring food to the table and pay the bills. Early data suggests it helped feed 2 million children and saved 3 million from poverty in the first month.
Families can receive a monthly benefit of $ 300 per child under 5 years old, which is $ 3,600 this year. The initiative provides $ 250 per month for each child ages 6-17, for a total of $ 3,000. Half of the benefit comes as a tax refund in 2022, and people don't have to file taxes to qualify like they did before this year.
But like most democratic initiatives right now, it faces possible cuts in an emerging law on social spending. The loan forms a large part of their Marquee Domestic Package and most of the support for making the changes permanent. However, Congress Democrats are looking for cuts across the board to please a small faction of centrists like Sens. Joe Manchin of West Virginia and Kyrsten Sinema of Arizona.
For a month now, Manchin has been making efforts to impose compulsory labor to ensure that only families who work and file taxes can receive federal aid. He argues that limiting eligibility to lower-income families ensures that government support reaches those most in need.
The West Virginia Democrat set an income threshold of $ 50,000 earlier this month. “When you want to aim, you target the people who need it most, who work,” he told HuffPost.
Manchin has an overwhelming influence on Biden's economic agenda. The Democrats are taking advantage of reconciliation, a legislative maneuver that only requires a simple majority and paves a way to bypass the unanimous opposition of the GOP. The Democrats need near unanimity in the House of Representatives and can't afford a single litter in the 50:50 Senate, which means Manchin's vote is crucial for the package.
Adding a job requirement could exclude millions of families. The previous structure of the child tax deduction left out families who did not earn enough to pay taxes, i.e. 27 million children who received only part or none of the child tax credit because their families did not earn enough.
House Democrats want to extend the child tax credit through 2025, betting that the benefit will be politically too expensive not to extend it. In the same year, some individual tax cuts under the Republican tax law are also due to expire.
"I think 2025 is a compromise," Washington Rep. Suzan DelBene, one of the architects of the expansion, told Insider last month. She argued that the income limits have already been lowered from $ 130,000 for singles in her original Child Tax Withholding Act to $ 75,000 in the Stimulus Act.
Higher earners may have an appetite for eligibility cutoff, as some of the credit can reach households making $ 400,000 a year. Treasury Secretary Janet Yellen hinted at the possibility in an interview with ABC News last Sunday.
"We know that programs that are universal tend to be long-lasting and very popular," she said. "But there is also an argument to ensure that the highest-income Americans may not benefit from a program most needed by lower-income Americans."
A Senate Democratic adviser familiar with the ongoing discussions told Insider that Senate Democrats still had an eye on an expansion through 2024, but warned that this would not be final as there was still no agreement on a price tag give. The person said they could cut the eligibility off high earners as well.
Read the original article on Business Insider
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Joe Manchin
US Senator from West Virginia

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