Do Parents Have a Chance of Getting More Stimulus Money in 2023?

If you're a parent, you should read this. 

The American Rescue Plan Act was the most recent COVID-19 relief bill that passed in Washington, D.C. There were many parts to this legislation, but parents especially benefited from an expansion of the Child Tax Credit. 

The extra funds provided by the Child Tax Credit were available only in 2021, as parents could not access this stimulus money in 2022. But, there's a small chance that lawmakers could take action in 2023 to make more Child Tax Credit funds available to families.

Here's what parents need to know.

What stimulus money was available to parents in the American Rescue Plan Act?

The American Rescue Plan Act provided payments of $1,400 to eligible adults and dependents regardless of their parental status. But the expanded Child Tax Credit was actually worth even more to some families.

This credit provided parents of children under 6 years old with $3,600 per child in tax credits. This money was fully refundable. Parents with older children were also entitled to $3,000 per child, which was also fully refundable. 

This was a substantial expansion of the existing Child Tax Credit. That provided just $2,000 for parents, and only $1,400 of the money could be refunded if you didn't owe enough in taxes to claim the full credit. So, many lower- and middle-income families were left out.

The expanded Child Tax Credit was also made more useful to families because it was paid out monthly beginning in June, rather than just being available after filing taxes. Families didn't have to wait until tax-filing season to get their money, or see their money disappear toward their tax bills if they owed one. Instead, they received a payment to their bank account each month from June to December. 

The credit was instrumental in reducing child poverty rates and it gave parents some much needed breathing room. Then it disappeared in 2022.

Will this stimulus money be back in 2023?

Many Democrats made continuing this credit a priority in 2022, but the Biden Administration was ultimately unsuccessful in getting a bill passed that would have provided more stimulus money to parents. Some of the more conservative lawmakers on the left were not on board, and a continuation of the expanded credit couldn't get enough support to be included in legislation. 

On the surface, it may seem like the prospects of more of this money for parents are even bleaker now, as Republicans have now taken control of the House of Representatives. Since the expanded credit is a priority on the left, it may have had a better chance when Democrats controlled both houses of Congress in recent years.

However, there are a number of prominent Republicans who actually support expanding the child tax credit. While their ideas for offering this money differ, the fact there is a bipartisan consensus that this type of help is needed for parents could mean there's a chance lawmakers from both sides of the aisle will come together to find a compromise.

There are few areas of agreement in a divided government, and with potential support from both Republicans and Democrats for an expanded Child Tax Credit, the possibility exists that this will become a priority issue and a compromise will be possible.