Direct Payments to Americans Gets New Support—Here's Who Backs the Plan

It's been three years since the first COVID-19 stimulus checks were distributed to Americans and more than a year since the last payment, but talks of a fourth round are emerging again as congressional support grows.

Over the course of the pandemic, the federal government sent out three direct payments to provide financial relief for millions of struggling Americans, including an expanded child tax credit (CTC) that offered families some economic wiggle room and is credited with briefly cutting child poverty by as much as 30 percent. Although those expansions expired at the end of 2021, there is now renewed interest coming from both sides of the aisle in reviving those monthly checks.

A top issue for Democrats, proposals to bring back the CTC are widely supported by Democrats in both chambers. In the House, 210 Democrats have already signed onto new legislation aiming to increase the $300 monthly payments to $2,000 for the month that a new baby is born. The newborn bonus is not included in the companion bill signed by over 40 Democratic senators, but the Senate version does make the CTC and the earned income tax credit for low-income workers permanent.

The new bonus proposed by House Democrats would push the benefit from $3,600 a year to as high as $53,000 for families of newborns, making the legislation unlikely to pass. The Congressional Budget Office has already estimated that a permanent extension of the COVID-era CTC, which offered $300 per month, would cost the government $105 billion a year.

"When we make investments in our children through the expanded child tax credit, the return that we get is incredible," Democratic Representative Suzan DelBene, who serves on the House Ways and Means Committee, told Roll Call last month.

While Republicans will be unlikely to support the price tag of the proposed CTC, some GOP lawmakers have signaled that they'd be willing to whittle it down and still include some version of the benefit to get the GOP its desired tax cuts.

On the Republican side, Representatives Brian Fitzpatrick and Don Bacon and Senators Todd Young and J.D. Vance have all suggested that the CTC could make a return to American households.

In a break from the majority of his party, Fitzpatrick told Punchbowl News last month that the debate over the monthly is "not dead" and that he would use his seat on the House Ways and Means Committee to push for reform for the rest of the season.

"It's going to be a live, open issue for this entire cycle, because you have people like me on the committee who actually do support it," the Pennsylvania Republican said.

Bacon also seemed willing to reconsider bringing the CTC back "as part of a compromise for the Democrats," telling the outlet that because the other side is rallying behind the benefit, it could quickly become "a bargaining chip that we can use."

Young echoed those remarks, saying that if the inclusion of the credit is "properly constructed and properly sized," there will be "some interest on the Republican side in negotiating a tax package."

Newsweek reached out to Fitzpatrick for comment.

Although a federal CTC is still in the talks, 12 states have enacted their own versions to help offer some relief for families. California, Colorado, Connecticut, Idaho, Maine, Maryland, Massachusetts, New Jersey, New Mexico, New York, Oklahoma and Vermont all have some type of benefit available.

Nine of those states have a fixed limit on the credit ranging from $100 to $1,000 for a qualifying child, while Colorado's tiered system is based on income levels and Oklahoma's is five percent of the federal credit. In New York, eligible households receive the greater of either 33 percent of the federal credit or $100 multiplied by the number of qualifying children.

In Montana, Republican Governor Greg Gianforte has introduced efforts to provide working families in the state with a permanent and refundable $1,200 CTC per child. Other states have also introduced legislation for state-level child tax credits that have not yet been passed into law.