Biden said Thursday he would push for the tax credit to be increased to $3,000 for children under the age of 17, and $3,600 for children under six. Families are normally entitled to up to $2,000 annually in refundable tax credits per child, an amount that was doubled by Republicans in 2017 with the passage of the Tax Cuts and Jobs Act.
Under the plan, families could opt to receive monthly payments – roughly $250 to $300 – instead of an annual lump sum. Biden's campaign said he would only support the expansion "for the duration of the crisis," referring to the coronavirus pandemic and subsequent economic recession.
The move "will provide thousands of dollars of tax relief for middle-class households," the plan says. "It will also help the most-hard pressed working families avoid poverty and attain greater economic security."
The former vice president's proposal is identical to a provision in the $3.4 trillion HEROES Act, which the House of Representatives passed in May. The Republican-controlled Senate rejected the measure.
It would cost about $109 billion, according to one analysis from the Joint Committee on Taxation, a nonpartisan congressional body.
The provision would also remove limits on receiving the credit as a refund and a requirement to be earning at least $2,500 -- restrictions that prevent about a third of low- and moderate-income children and families from receiving the full credit, according to an analysis from the Institute of Taxation and Economic Policy, a left-leaning think tank. A parent needs to earn at least $11,833.33 annually to qualify for the full refundable credit.
A recent study from Columbia University's Center on Poverty and Social Policy found that some of the changes backed by Biden would lift about 4 million children out of poverty.