Dozens of Democrats call for action on child tax credit during lame-duck session

Dozens of House Democrats are calling on caucus leadership to extend the enhanced child tax credit in the lame-duck session, as lawmakers look to tick off more legislative priorities in the final weeks of the current Congress.

Members of the New Democrat Coalition — the largest Democratic coalition in the House — penned a letter to Speaker Nancy Pelosi (D-Calif.), House Majority Leader Steny Hoyer (D-Md.) and Whip James Clyburn (D-S.C.) on Thursday requesting that they “prioritize the enhanced [child tax credit] in any end-of-year package.”

Congressional Democrats expanded the child tax credit in the American Rescue Plan, a $1.9 trillion COVID-19 relief bill President Biden signed in March, just weeks into his presidency. The measure increased the child tax credit from $2,000 to $3,600 for qualifying children under 6 years old, and $3,000 for other children under 18 years old who qualify.

The last payment with the enhanced provision, however, was sent on Dec. 15, 2021, because Congress did not pass a measure to renew the program. Democrats were looking to renew the program in its sprawling Build Back Better package, but the measure stalled in the Senate.

Nearly 4 million American children — 3.7 million — fell into poverty in January after the provision expired, according to a study from the Center on Poverty and Social Policy at Columbia University.

“The enhanced CTC lifted millions of children out of poverty, gave parents the flexibility to return to work, and provided families a stronger opportunity to succeed,” the group of 51 lawmakers wrote to Democratic leadership in a letter, first reported by Punchbowl News.

“New Dems believe that we must extend the enhanced CTC so American families and children have the resources and opportunities to flourish,” they later added.

The lawmakers are also pushing for Congress to advance the research and development tax credit fix, which the New Democrat Coalition said is “essential to increasing investments in American competitiveness and innovation.”

The research and development tax credit benefits some domestic expenses some companies make. A measure in the 2017 Tax Cuts and Jobs Act, crafted by Republicans, enacted a provision that requires companies to seek deductions under the tax credit over five years rather than after the first year.

“The research and development (R&D) tax credit has helped foster the competitiveness and innovation of the U.S. economy and American businesses. Unfortunately, as a pay-for gimmick for the irresponsible 2017 GOP tax law, Republicans made an onerous, punitive change to the tax treatment of R&D expensing beginning in 2022,” the lawmakers wrote in their letter to House Democratic leadership.

“Unless addressed, this detrimental GOP tax change will hurt U.S. economic competitiveness, stifle the innovation that has powered our economy, and undermine the historic investments President Biden and Democrats in Congress have made in science, technology, and the growth and opportunities of U.S. businesses, workers, students, and entrepreneurs,” they added.

Lawmakers are scheduled to return to Washington in the middle of November for the final weeks of the 117th Congress. Lawmakers have a packed to-do list for the lame duck session, but top of the list is passing a budget by Dec. 16 to avoid a government shutdown.

Democrats are looking to pack some legislative priorities into the lame-duck session — like funding for Ukraine — as election forecasters predict Republicans will take control of the House in next month’s midterm elections.