Tax Day is here, but the expanded Child Tax Credit never materialized

Earlier this year, the federal Child Tax Credit appeared headed for an expansion that would have helped lift hundreds of thousands of children out of poverty. But the expanded CTC failed to materialize ahead of the April 15 tax deadline, and its future appears uncertain. 

The bill, called the Tax Relief for American Families and Workers Act of 2024, easily passed the House in February with bipartisan support. But it currently remains mired in the Senate, with Senator Josh Hawley, a Republican from Missouri, telling NBC News earlier this month that the bill is "on life support."

Some parents were watching the bill's progress because it had a provision that could have boosted their refund for their 2023 taxes, which are due on April 15 (unless a taxpayer requests an extension.) The expanded CTC would have bumped up the credit's maximum per-child refund amount to $1,800, up from $1,600 in its current form. 

Tax experts caution it's not a good idea to delay filing your taxes with the hope that tax legislation could pass, given the unpredictability of the political process. While April 15 is the regular tax-filing deadline, taxpayers can request an extension that gives them until October 15 to send their returns to the IRS. 

"Don't wait to file," said Mark Jaeger, vice president of tax operations at TaxAct, told CBS MoneyWatch. "I'm not saying it's impossible — there are people on both sides of the aisle that would like it to happen — but I wouldn't hold my breath."

Child Tax Credit: Could it start in 2024?

The Tax Relief for American Families and Workers Act still hasn't been scheduled for a vote in the Senate, with the New York Times reporting that Republicans have pushed back against some provisions. 

One of those issues is a so-called "look back" provision that would allow parents to use income from a prior year if it would help boost the amount they could claim through the CTC. Some Republican lawmakers claim it could weaken parents' incentive to work, Politico reported.

Even so, advocates are still holding out hope that the tax bill could pass. The National Parents Union, an advocacy group for parents, urged lawmakers at an April 10 rally to move the legislation forward. 

"Both Republicans and Democrats, doesn't matter what area of the country we're talking about — there is unanimity," said National Parents Union co-founder Keri Rodrigues in a statement. "American families are in support of this Child Tax Credit."

What happens if expanded CTC goes into effect after you file?

If Congress passes the legislation, the IRS says it will automatically make adjustments for parents who already filed and claimed the CTC. 

The IRS is urging taxpayers not to wait to file their 2023 tax returns in anticipation that Congress could pass the expanded Child Tax Credit. 

What can parents claim for the 2023 Child Tax Credit?

Without the bill's passage, the Child Tax Credit is $2,000 for each eligible child for the 2023 tax year. 

There is an income limit for claiming the $2,000 credit, which is $200,000 in adjusted gross income for single filers and $400,000 for joint filers. 

A portion of that $2,000 credit is considered fully refundable, which means that you can receive it as a tax refund even if you don't owe any federal taxes. That's noteworthy because some tax credits will at most reduce your tax liability to $0, and any amount of the credit beyond that has no impact on your refund. 

But in the case of the CTC, the tax credit is refundable up to $1,600 per child, potentially boosting their tax refund by that amount.

In:
• IRS
• Taxes
• Child Tax Credit

Aimee Picchi

Aimee Picchi is the associate managing editor for CBS MoneyWatch, where she covers business and personal finance. She previously worked at Bloomberg News and has written for national news outlets including USA Today and Consumer Reports.

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