Washington, DC…Thank you. Well, for you — anybody under the age of 13 — this has got to be boring, boring, boring for you. (Laughter.) Right? Well, I’ll tell you what, we have to work something out here so that when this is over, your parents, your uncles, your aunts — whoever you’re with — they owe you some ice cream or something for this. You know? (Laughter.)
Folks, it’s a pleasure to be here. I’m going to take a sip here. (Drinks water.) And this — I believe this is actually a historic day — a historic day in the sense that we continue to build an economy that respects and recognizes the dignity of working-class families and middle-class families. It’s historic and it’s our effort to make another giant step toward ending child poverty in America. I think this will be one of the things that the Vice President and I will be most proud of when our terms are up.
Beginning this morning, nearly all working families — that is people making under $150,000 as families or an individual making under $120,000 — $125,000 who have children, are raising children in America, they’re going to receive their first monthly — first monthly tax cut payment. That payment — that payment from the expanded Child Tax Credit that we signed into law as part of my — our American Rescue Plan.
It’s one of the largest-ever single tax cuts for families with children, and it’s a reflection of our belief that the people of this country who need a tax cut aren’t the folks at the top. They’ve got plenty of tax cuts. They’re doing just fine. But it’s the people in the middle, the folks who are struggling, who are just looking for a little bit of — my dad would say, “a little bit of breathing room.” A little bit of breathing room.
This has the potential to reduce child poverty in the same way that the Social Security reduced poverty for the elderly. And by the way, you think of monthly payments — you get a Social Security check — those who you know get Social Security, they get it monthly. Well, this will be — unless you want it in one lump sum, this would be a monthly payment for childcare — for — excuse me, for your children, a tax cut.
And here’s how the tax credit works: For every child under the age of six, a parent will get $3,600 a year. For every child 6 to 17, they’ll get $3,000 per year. For example, a middle-class family with two young children would expect to receive $7,200 a year to help raise their children. This will be the — they’ll get the first half of this $3,600 starting today. Today. Today. And it’ll be paid out at $600 a month between now, July, and December. And then they’re going to get the rest of the payment next spring around Tax Day.
Now, if you file taxes electronically, you can go to your bank account today — today — and you’ll see a payment that says “Child CTC.” Let me say that again: payments of $300 for each child under the age of 6, $250 for each child between the ages of 6 and 17 on a monthly basis between now — between July and December.
If you don’t file electronic- — your taxes electronically, as you did last year, you can expect to receive a check in the mail beginning today or a few days from now. And you’ll get this payment on the 15th of every month for the rest of this year.
And if you’re not required to file taxes at all in the past — you haven’t filed because you didn’t owe any taxes, then you can go to: ChildTaxCredit.gov. Let me say it again: ChildTaxCredit.gov. And you will give you — they’ll give you clear information and a link to help you sign up for the first time. This can be lifechanging for so many families.
Because of the way the tax credit was structured before the American Rescue Plan, more than 26 million children from the hardest-pressed working families didn’t get any full payment for the Child Credit — for childcare — for Child Tax Credit. Half of all Black and Hispanic children in America never received the full tax credit. We’ve changed all that.
In technical terms, we’ve made this tax cut fully refundable. In plain English, it means instead of families who need help the most getting the le- — getting the least, the hard-working — the hard-working families will get this on a month- — full monthly basis.
Ninety-seven percent of the children receiving this credit come from working families. And the other 3 percent includes kids being raised by retired grandparents or by someone with a serious disability.
And by the way, this credit doesn’t start to phase out until a couple is making $150,000 or a single parent is making $112,000 [$112,500]. It begins to phase out then. This is a middle-class tax cut. When I came up — when I decided I wanted this in the legislation, I referred to it in the way it really is: It’s a middle-class tax cut. It’s just like the wealthy get tax cuts for a lot of things, this is a tax cut for your children — having children.
And this can make it possible for a hardworking parent to say to his or her child, “Honey, we get — you can get your new braces now. We can get you a tutor to help you in that math class you’re having trouble with. We can get you the sports equipment you need to sign up to — for your first team you’re going to play on.”
People have written me to tell me they’ll use the money to buy their kids new shoes, to send them to summer camp, to cover afterschool care when school starts up again.
You know — and to give you a sense of how transformative this is: This would be the largest-ever one-year decrease in child poverty in the history of the United States of America — as we begin now. Historic reductions in child poverty among white, Black, and Latinos, and AAPI communities. It’s not even close. The benefits will be felt for years.
Studies have shown — (a baby cries) — that tax relief that helps children — that’s okay, don’t worry about it. It’s okay to let him cry, or her, whichever — that helps children and can lead to better health, better school performance, and better future earnings.
In fact, research from Columbia University in New York found that for each dollar this tax cut costs, it returns eight dollars in benefit down the line. Eight dollars would have to be spent other ways. It’s a gigantic help. It’s an eight to one return.
Your head, your heart, and your budget all lead to the same place. This is the right thing to do, and it’s the smart thing to do.
Today, these tax cut payments are arriving automatically. But it didn’t happen automatically — the result of the work that people who did this, advocating for this for a long, long time. And we finally got it passed in my American Rescue Plan.
I want to particularly thank those who have been fighting for this for years: Congresswoman Rosa DeLauro from Connecticut. She has been a champion for this issue. Congressman Richie Neal and — and Torres. And Senators Bennet, Brown, and Booker. And Ron Wyden.
You’ll probably hear from our Republican friends — all who voted against this — but they’ll tout the success as it helps working families in their states and their districts. But in the coming days, we’re also going to hear from them saying, “I want to now extend this tax…” It’s only for one year now.
It’s all I could get it for, for the first time. And so, I want to extend it into the future now. I have another piece of legislation that will be voted on soon, saying we’re going to continue this.
To the people who say we can’t afford to give the middle class a break, I say: We can afford it by making people at the top and the big corporations — over 50 of which paid no taxes last year at all — to finally just — just start paying their fair share. I’m not going to gouge them. Just pay their fair share. Because people who are working hard and paying taxes deserve a break.
That’s why — excuse me for all these terms I’m using, but my Build Back Better agenda, which still needs to be voted on in the Congress, keeps this tax cut for working families in place for years to come. We shouldn’t let taxes go up on working families. We shouldn’t let child poverty continue to stain the conscience or drag down our economy.
And so, I say to my colleagues in Congress: This tax cut for working families is something we should extend, not end, next year.
And I say to all of you watching: Make sure your family, friends, and community know about this tax cut. Send to them, as I said, ChildTaxCredit.gov to learn more about the difference this is going to make in their lives.
Let me close with this: I signed the American Rescue Plan less than two months after taking office on January 20th. Four months later, we’ve implemented the fir- — we’ve implemented the first-ever automatic monthly payment for any major tax credit ever, as the Vice President was talking about, beyond Social Security, which was a long time ago.
This groundbreaking effort is similar to what we did in our — what I called our “war-time effort” to vaccinate Americans against COVID-19, to mobilize the whole country.
We’re proving — we’re proving that democracy can deliver for people, and deliver in a timely way — saving lives, improving lives, helping fuel a recordsetting recovery, giving working families a fighting chance again.
I received an email today from a mother in Washington State. She’s a young teacher who had just received her payment. She wrote, and I’m quoting, “My family has been living hand to mouth to put me through school so I can follow my passion of molding young minds… This first CTC payment has come at the exact moment when we need it most. These payments may seem small to some, but they are lifechanging for my family, for us.”
Millions of children and their families — starting today, their lives are about to change for the better. And our country will be better off for it as well.
This is a really good day. And parents are going to be able to tell your kids when they’re 25-years-old that you were there the day this happened; we talked about it. We are showing once again that there’s nothing beyond the capacity — our capacity as Americans to get done when we do it together.
So, I want to thank you. God bless you all. And may God protect our troops. And kids, thank you for being so polite while I was speaking. You’re very, very nice. Thank you, thank you, thank you.
See you all. Bye bye. (Applause.)
12:39 P.M. EDT