A task force convened by Joe Biden in partnership with Bernie Sanders has recommended Biden commit to giving more generous refundable tax credits to low- and middle-income families that would help them build wealth.
The task force suggests making the tax code more “progressive and equitable” and adding provisions that “build wealth and support working families.” The tax break would occur through generous, “refundable” tax credits, meaning people could claim for it even if the tax break exceeded their tax liabilities, by receiving a check from the federal government for the difference.
Tax credits are not universally favored by Democrats. Sens. Elizabeth Warren and Sanders mostly leaned away from them during their 2020 campaigns.
But in 2018, Sen. Kamala Harris of California proposed a $6,000 a year, or up to $500 a month, refundable tax credit for families earning up to $100,000. This was before she announced she was running to be the Democratic nominee for president, competing against Biden. Harris created the tax break to help families cope with the high cost of living. The plan would increase the number of U.S. citizens who effectively don’t have to pay income taxes, which, in 2018, was approximately 44%.
Sen. Michael Bennet of Colorado, another Democrat who ran against Biden in the Democratic primary, introduced legislation in 2019 to overhaul the existing Child Tax Credit to provide more support to middle-class families. The bill would create a new $300 per month, per-child credit for children under 6 years of age and a $250 per-month, per-child credit for children under 17 years of age. This would increase the credit for all children, and the credit would be fully refundable.
No specifics were given regarding the family tax credits Wednesday, and Biden has not explicitly committed to following through on the recommendations outlined by the task force.
“I commend the task forces for their service and helping build a bold, transformative platform for our party and for our country,” Biden said in a statement on Wednesday.
The Biden-Sanders task force also recommends helping working families by expanding the Child and Dependent Care Tax Credit to provide a fully refundable, advanceable tax credit. This would allow families to have better, more affordable child care, the task force said.
