It's the time of year when you have the laptop out and are reviewing your family's tax information before you submit it to the IRS. Well, Congress is looking at taxes, too, with a potential deal emerging that could really impact your family's pocketbook.
The tax deal has been brokered by Democratic Sen. Ron Wyden of Oregon and Republican Congressman Jason Smith of Missouri. Both men play key roles when it comes to tax policy in Congress and both want this deal to pass soon.
Under current law, the maximum child tax credit is $2,000 per child. But only $1,600 of that is refundable when you file your taxes. The proposal would change to $1,800 right away, with $100 annual increases until 2025. Eventually, the tax credit would be tied to inflation, like Social Security checks.
Lawmakers behind the deal are eager to pass this soon, so families could get the benefits when the 2023 tax filing season begins toward the end of this month.
In this Congress, though, passing anything this consequential is a tall task, and some top Congressional leaders have already signaled the deal needs some changes to get their support. There remain more pressing concerns, too, like avoiding partial government shutdowns.
The $78 billion tax legislation also includes incentives for companies to build low-income housing, benefits for some semiconductor companies from Taiwan, business deductions for research and development costs, and tax relief for victims of recent disasters, like the train derailment in East Palestine, Ohio, last year.
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