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Senator Ron Wyden, Democrat of Oregon, claims that 15 million children from low-income families will benefit from the program.
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The proposed stimulus credit increases the maximum amount of refundable funds per child to $1,800 in 2023, $1,900 by 2024, and $2,000 by 2025.
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This adjustment enables low-income families to receive a larger portion of the credit that is refundable, unlike the previous tax exemption, which was limited to $1,600 for each child.
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The new rules of the credit scheme are meant to provide more funds to families who have more than one child, by taking into account the number of eligible children in calculating the amount of credit.
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The Center on Budget and Policy Priorities estimates that the credit for a single-parent earning $13,000 with two children could increase by one-third in a year's time, resulting in a $1,575 benefit.
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The new tax credit for children would address criticisms about the previous system, and also help families in need.
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