U.S. Treasury Secretary Janet Yellen testifies during a Senate Finance Committee hearing on the 2025 budget at Capitol Hill in Washington, U.S., March 21, 2024.
Elisabeth Franz | Reuters
WASHINGTON — Treasury Secretary Janet Yellen defended President Joe Biden on ThursdayBudget 2025 Opponents of the senator’s proposal worry that taxes on the middle class could rise due to a law that expires next year.
“For years, President Biden has vowed not to raise taxes on individuals making less than $400,000,” Sen. Steve Daines, R-Mont., told the Senate Finance Committee before Yellen testified. stated at the hearing.
“Now President Biden has chosen to let tax cuts and jobs act Expires and raises corporate tax rates, forcing American families and workers to bear the costs of these ‘woke’ policies,” Daines said, referring to clean energy policies in 2022 Inflation reduction method.
The TCJA is a landmark tax law proposed by the Trump administration and passed by Congress in 2017. Its provisions are set to expire in 2025, including the child tax credit.
The credit allows taxpayers to reduce their taxes by up to $2,000 per qualifying child, with an income threshold of up to $400,000 per family.
The additional “Other Dependent Credit” provides a $500 tax credit to people who earn less than $400,000 and whose dependents do not qualify for the child tax credit.
“Do you agree that taxes on Americans earning less than $400,000 will increase if the TCJA child tax credit is not extended?” said Sen. Mike R-Idaho, the committee’s ranking member. Crapo asked Yellen.
Yellen said Biden is “committed not to raise taxes on families making less than $400,000 a year” and said he is “committed to the importance of the child tax credit, which has dramatically reduced child poverty.”
TCJA Double the existing child tax credit to $2,000The 2021 American Rescue Plan temporarily increased the credit amount by $1,000 to $1,600 during the pandemic, according to the National Conference of State Legislatures.
Credit helped hold down Child poverty rate to fall by 46% in 2021That went from 9.7% in 2020 to 5.2% in 2021, which is the lowest rate on record, according to the U.S. Census Bureau.
Biden’s budget will Reinstate expanded child tax creditthe White House said.
His $7.3 trillion spending proposal aims to reduce the federal deficit by $3 trillion over 10 years without raising taxes on Americans earning less than $400,000.
The budget will impose a tax rate of at least 25% on the unearned income of the richest households and increase Corporate Alternative Minimum Tax for IRAs For multi-billion dollar companies, the tax rate is increased from 15% to 21%, while the tax rate for larger companies is increased to 28%.
House Republicans seek inflation-cutting bill to cut deficit of about $14 trillion over next decade separate budget resolution Launched earlier this month.
Despite a deal this week to fund the Department of Homeland Security, lawmakers have still not reached agreement on a permanent budget six months into the fiscal year. It’s the latest in a series of funding bills being considered ahead of a looming deadline next weekend to avert a government shutdown.
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