The Child Tax Credit in the Senate Finance Committee Text of the Build Back Better Act: Summary Table

The Child Tax Credit in the Senate Finance Committee Text of the Build Back Better Act: Summary Table

link to page 2 link to page 2 link to page 2

INSIGHTi

The Child Tax Credit in the Senate Finance
Committee Text of the Build Back Better Act:
Summary Table
December 14, 2021
On December 11, 2021, the Senate Finance Committee released updated text of the committee’s
provisions in the Build Back Better Act (BBBA; H.R. 5376). This updated text of the BBBA would
extend the 2021 expansion of the child credit for one year—2022—and would permanently make the
credit fully refundable beginning in 2023. As a result of these changes, many taxpayers in 2022 would
continue to receive a monthly benefit of up to $300 per young child (0-5 years old) and up to $250 per
older child (6-17 years old).
With respect to the child tax credit provisions, the updated Finance Committee text is virtually identical to
the House-passed BBBA (see table note “a” at the end of Table 1 for more information).
Major changes to the child tax credit made by the Finance Committee’s updated BBBA text are
summarized below in Table 1. Table 1 is not a comprehensive accounting of every change included in the
updated Finance Committee text, nor does it include specific details for every proposed change. The
figures following the table illustrate the annual credit amount by income for different years.
Congressional Research Service
https://crsreports.congress.gov
IN11827
CRS INSIGHT
Prepared for Members and
Committees of Congress

link to page 5 link to page 5 link to page 5 link to page 5 link to page 5 Congressional Research Service
2
Table 1. Selected Parameters of the Child Tax Credit
Under the December 11 Updated Senate Finance Committee Text of the Build Back Better Act (H.R. 5376)
CURRENT LAW
PROPOSED UNDER BBBA
2021a
2022-2025
After 2025
2022
2023-2025
After 2025
Parameter
(a)
(b)
(c)
(d)
(e)
(f)
Maximum
$3,600 per
$2,000 per
$1,000 per
Same as
Same as
Same as
Credit
child 0-5 years
child 0-16
child 0-16
current law
current law
current law
Amount
old
years old
years old
for 2021 (a)
for 2022-2025
after 2025 (c)

not adjusted for
not adjusted for
(b)
$3,000 per
inflation
inflation
child 6-17
years old

not adjusted for
inflation
Credit
Ful y
Phased-in
Phased-in
Same as
Ful y
Ful y
Amount Low-
refundableb
amount
amount
current law
refundableb
refundableb
Income
$3,600 per
calculated
calculated
for 2021 (a)
$2,000 per
$1,000 per
Taxpayers
child 0-5 years
based on
based on
child 0-16
child 0-16
Can Receive
old
earned income earned income
years old
years old

formula:
formula:
Ful y

refundableb
15% of earned
15% of earned
$3,000 per
income above
income above
child 6-17
$2,500 not to
$3,000 not to
years old
exceed $1,400
exceed $1,000
per child 0-16
per child 0-16
years old
years old
Maximum
$300 per
N/A. No
N/A. No
$300 per
N/A. No
N/A. No
Monthly
young child
monthly
monthly
young child
monthly
monthly
Amount
$250 per older payment of
payment of
$250 per older payment of
payment of
child
credit
credit
child
credit
credit
not adjusted for
not adjusted for
inflation
inflation
Phaseout
Initial
$400,000 MFJ
$110,000 MFJ
Same as
Same as
Same as
Threshold(s)
Threshold
$200,000
$75,000 HOH current law
current law
current law
MFJ: married
(Phaseout of
HOH
for 2021 (a)
for 2022-2025
after 2025 (c)
$75,000 S
filing jointly
Increased
(b)
Credit)
$200,000 S
HOH: head of
household
$150,000 MFJ
S: single
$112,500
HOH
$75,000 S
Second

Threshold
(Phaseout of
Pre-ARPA
Credit)
$400,000 MFJ
$200,000
HOH
$200,000 S

link to page 5 link to page 5 link to page 5 Congressional Research Service
3
CURRENT LAW
PROPOSED UNDER BBBA
2021a
2022-2025
After 2025
2022
2023-2025
After 2025
Parameter
(a)
(b)
(c)
(d)
(e)
(f)
Income
No
No
No
Yes. Lowest
No
No
Lookback for
income of the
Phaseout
current year
(2022) and
preceding year
(2021)
ID
Work-
Work-
Any taxpayer
Same as
Same as
Same as
Requirement
authorized
authorized
ID (e.g.,
current law
current law
current law
of Qualifying
SSN
SSN
SSN/ITIN/
after 2025 (c)
after 2025 (c)
after 2025 (c)c
Child
ATIN)
ID
Any taxpayer
Any taxpayer
Any taxpayer
Same as
Same as
Same as
Requirement
ID (e.g.,
ID (e.g.,
ID (e.g.,
current law
current law
current law
of Taxpayer
SSN/ITIN)
SSN/ITIN)
SSN/ITIN)
(a), (b), & (c)
(a), (b), & (c)
(a), (b), & (c)
Maximum
17 years old
16 years old
16 years old
17 years old
16 years old
16 years old
Qualifying
Child Age
Method of
Up to 50%
No advance.
No advance.
Up to 100%
No advance.
No advance.
Receipt
advanced (IRS
Credit claimed
Credit claimed
advanced (bil
Credit claimed
Credit claimed
advanced as 6
on tax return.
on tax return.
would advance on tax return.
on tax return.
monthly
all of the
payments in
credit in 12
2021);
payments in
remainder
2022 for
claimed on tax
taxpayers with
return
income below
initial
threshold)d

link to page 5 link to page 6 Congressional Research Service
4
CURRENT LAW
PROPOSED UNDER BBBA
2021a
2022-2025
After 2025
2022
2023-2025
After 2025
Parameter
(a)
(b)
(c)
(d)
(e)
(f)
Repayment
Safe Harbor
N/A
N/A
Safe Harbor
N/A
N/A
protection for
Amount:
Amount:
excess
Repayment is
Repayment
advance
limited to
would be
paymentse
cases where
limited to
the number of
cases where
children used
the number of
to estimate
children used
the advance
to estimate
payments of
the advance
the 2021
payments of
credit differs
the 2022
from the
credit differs
number of
from the
children
number of
actually
children
claimed on the
actually
2021 return. In
claimed on the
these cases,
2022 return.
any amount
The maximum
the taxpayer
safe harbor
would
would be
otherwise
$3,600 times
need to repay
this difference
is reduced by a
in number of
safe harbor
young children
amount. The
0-5 years old,
maximum safe
plus $3,000
harbor amount
times this
is $2,000 times
difference in
this difference
number of
in number of
older children
children.
6-17 years old.

Safe Harbor

Safe Harbor
Phaseout:
Phaseout:
The safe
Same as
harbor amount
current law
is subject to
for 2021 (a)
phaseout.

link to page 5 Congressional Research Service
5
CURRENT LAW
PROPOSED UNDER BBBA
2021a
2022-2025
After 2025
2022
2023-2025
After 2025
Parameter
(a)
(b)
(c)
(d)
(e)
(f)
Applicability

Applicability
of Safe
of Safe
Harbor:
Harbor: Same
There is no
as current law
repayment
for 2021 (a)
protection for
changes in
credit amount
due to changes
in income and
marital status
between the
reference year
and the
applicable
return.
Would Other
Yes.
Yes.
No.
Yes. Proposed
Yes. Proposed
No.
Temporary
ARPA changes
Temporary
Temporary
changes in
changes in
Temporary
Modification(s)
for 2021 are
changes made
changes made
BBBA for 2022 BBBA for 2022 changes made
to the Child
layered on
by P.L. 115-97
by P.L. 115-97
would be
would be
by P.L. 115-97
Credit Be in
existing
are in effect.
are scheduled
layered on
layered on
are scheduled
Effect?
temporary
to expire.
existing
existing
to expire.
changes made
temporary
temporary
by P.L. 115-97.
changes made
changes made
by P.L. 115-97.
by P.L. 115-97.
Source: CRS analysis of the Build Back Better Act, updated text released by the Senate Finance Committee on December
11, 2021.
Notes: A child’s age for the purposes of these age limits is based on their age on last day of the year. For the purposes of
advancing the credit, the IRS can use existing data to project the child’s age. Income for most taxpayers is their adjusted
gross income (AGI).
a. The bil also proposes making changes to the credit for 2021 concerning the applicability of the safe harbor, married
joint filers, and data used to calculate the advance payments. These are virtually identical to the changes included in
the House-passed version of the BBBA. One key difference between the House-passed text and the updated Senate
Finance committee text concerns the types of information that the Treasury Secretary could disclose to certain
taxpayers who receive advance payment of the child credit. Under both versions of the bil , in the case of an
individual who receives an advance payment, and who was a married joint filer during the reference year (generally
the previous year data used to calculate advance payments), the Treasury Secretary may disclose to that individual’s
spouse (or former spouse) information about the individual’s number of qualifying children (and their names and
taxpayer IDs), income, marital status, and principal place of abode. In the updated Senate Finance Committee text,
this “principal place of abode” language is eliminated and replaced with whether the individual’s principal place of
abode is the United States or whether the individual is a resident of Puerto Rico.
b. Ful y refundable means eligible low- and moderate-income taxpayers can receive the “ful ” or maximum credit
amount, irrespective of their income. Low-income taxpayers are generally only eligible for the ful amount in 2021 if
their principal place of abode is in the United States or Puerto Rico. This provision permanently extends that
requirement to receive a ful y refundable tax credit.
c. Prior to the expansion of the child credit under the American Rescue Plan Act (ARPA; P.L. 117-2), the ID
requirement for qualifying children was temporarily changed from any taxpayer ID to a work-authorized SSN for 2018-
2025. Hence, under current law, absent any changes under BBBA, the taxpayer ID requirement for qualifying children
is scheduled to be any taxpayer ID beginning in 2026.
d. Advance payments of the 2022 credit would generally only be issued to taxpayers with incomes under $150,000 if
married filing jointly or income under $112,500 if a head of household filer. This provision is also included in the
House-passed bil .

Congressional Research Service
6
e. Excess advance payments are equal to the value of the credit a taxpayer is eligible to claim on their tax return minus
amounts received as advance payments.

Congressional Research Service
7

Congressional Research Service
8

Congressional Research Service
9

Author Information

Margot L. Crandall-Hollick

Specialist in Public Finance

Disclaimer
This document was prepared by the Congressional Research Service (CRS). CRS serves as nonpartisan shared staff
to congressional committees and Members of Congress. It operates solely at the behest of and under the direction of
Congress. Information in a CRS Report should not be relied upon for purposes other than public understanding of

Congressional Research Service
10
information that has been provided by CRS to Members of Congress in connection with CRS’s institutional role.
CRS Reports, as a work of the United States Government, are not subject to copyright protection in the United
States. Any CRS Report may be reproduced and distributed in its entirety without permission from CRS. However,
as a CRS Report may include copyrighted images or material from a third party, you may need to obtain the
permission of the copyright holder if you wish to copy or otherwise use copyrighted material.

IN11827 · VERSION 1 · NEW