“Expansion of the Child Tax Credit is the most significant policy to come out of Washington in generations, and Congress has an historic opportunity to provide a lifeline to the middle class and to cut child poverty in half on a permanent basis. No recovery will be complete unless our tax code provides a sustained pathway to economic prosperity for working families and children. Permanent expansion of CTC will continue to be our priority.”

Supporting the statement were Sens. Michael Bennet (D-Colo.), Sherrod Brown (D-Ohio), and Cory Booker (D-N.J.); joining them were Reps. Rosa DeLauro (D-Conn.), Suzan DelBene (D-Wash.), and Ritchie Torres (D-N.Y.)

The expanded credit, part of the American Rescue Plan Act will work very differently from the way the program has operated in previous years. In general, the legislation increased the credit from $2,000 to $3,000 per child (and to $3,600 for each child under the age of six) for the 2021 tax year. It also increased the older age limit of a qualifying child from 16 to 17. But more relevant is how the credit will be distributed under a new Section 7525A of the Internal Revenue Code. Rather than the IRS awarding the credit all at once at tax time, the agency will instead send payments on a monthly basis, with each one being an equal amount.

While IRS Commissioner Charles Rettig had previously expressed concerns that the IRS, which he said is under severe stress due to the changed tax deadline, would not have the resources to enact this provision, he said later on that it is ready to move on distributing the credit starting in July.

President Biden was a strong supporter of the expanded credit as part of his pandemic recovery plan, but, the Wall Street Journal reported, he has declined to back a permanent extension, believing such a proposal would not play well in the Senate. As an alternative, he has suggested extending the changed credit through 2025.