US to Increase Childcare Allowance from July... Up to $300 per Child Under Age 6

[Photo by AP Yonhap News]

[Asia Economy Reporter Park Byung-hee] Starting in July, the child tax credit in the United States will be increased. Families with children under the age of 6 will receive up to $300 per child per month. Additionally, for children aged 6 to 17, $250 per child per month will be provided. This is part of the child tax credit support included in the $1.9 trillion stimulus bill signed by U.S. President Joe Biden on March 11 (local time).

The U.S. Internal Revenue Service (IRS) announced that the increased child tax credit will be paid to approximately 39 million American households starting July 15, according to a report by The Wall Street Journal on the 17th (local time).

The stimulus bill expanded the child tax credit to a maximum of $3,000 annually for children aged 6 to 17, and up to $3,600 annually for children under 6. Previously, the maximum annual payment was $2,000.

The IRS stated that families raising a 5-year-old and a 13-year-old will receive $550 deposited into the parents' accounts on the 15th of each month. Furthermore, if the 15th falls on a holiday or weekend, the payment will be made on the closest preceding day.

The child tax credit payment amount will be reduced for individuals earning over $75,000, couples earning over $150,000 jointly, and heads of households earning over $112,500. The income thresholds for reduced payments have been significantly lowered. Previously, the reduction began at individual incomes over $200,000 and joint incomes over $400,000.

The U.S. government estimates that about 65 million children, representing approximately 88% of all American children, will benefit from this program.

The Committee for a Responsible Federal Budget (CRFB), a bipartisan think tank, estimates that the expanded child tax credit will cost about $150 billion annually.

The increased child tax credit will be paid through December. Continued payments beyond that will require congressional approval.

However, President Biden included a plan to extend the increased child tax credit through 2025 in the "American Families Plan," a human infrastructure investment bill he proposed last month. It is known that President Biden hopes to make this program permanent.

The Republican Party strongly opposes this measure, particularly criticizing that the same amount of money is given to both non-working and working parents. They argue that this will encourage parents not to work and become more dependent on the government.

This content was produced with the assistance of AI translation services.