Expanded child tax credits 'should be permanent': former Obama senior advisor

The first monthly payments of the expanded child tax credit were sent to millions of U.S. households last week, an achievement the Biden administration has touted as "transformative."

The monthly payments, which totaled about $15 billion for July and covered approximately 60 million children, are currently scheduled to roll out through December, but many supporters are pushing to extend the credit.

“I strongly believe it should be permanent. It's helping hardworking families,” Valerie Jarrett, former senior advisor to President Obama, told Yahoo Finance Live. “There are countless families around our country that are still struggling. We have to make sure that we have resources available to bring our children out of poverty. So many working families, particularly working moms, have been stuck in this horrible limbo of not being able to afford child care for their children so that they can go back and work.”

The child tax credit, which Congress expanded in March as part of the $1.9 trillion American Rescue Plan, increased the maximum credit per child to $3,600 for those under the age of 6 and up to $3,000 for children ages 6 to 17. The credit also is now fully refundable, which means families that owe little or no income tax will receive the full amount. According to estimates by the Treasury Department, this change affects more than 26 million children.

Proponents of the child tax credit promote the expansion as a massive step in the battle against child poverty. The Center on Poverty and Social Policy at Columbia University estimates the increased payouts will have a substantial impact on reducing poverty in the United States, cutting it by more than half.

“What President Biden is doing is redefining infrastructure, not just roads and bridges, but infrastructure to support working families so that they are able to go back to work and get the skills that they need to compete for the jobs of the future,” Jarrett added. “This more holistic approach to rebuilding our economy positions the United States to be globally competitive.”

Jarrett is far from the only Democrat who supports extending the child tax credit. In a letter sent to Biden earlier this year, 40 Democratic senators called to extend the payouts, writing “Moving forward, if indeed we are to build back better, these changes must be made permanent to ensure a sustained and equitable recovery for American workers and families.”

Seana Smith anchors Yahoo Finance Live’s 3-5 p.m. ET program. Follow her on Twitter @SeanaNSmith

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