Parents would receive monthly checks, even after this year is over, under President Joe Biden’s forthcoming multitrillion-dollar plan for American families.

If made permanent, the payments could amount to one of the most consequential policy changes of Biden’s presidency, finally bringing the U.S. into the ranks of other advanced nations that pay parents a monthly child allowance.

But it’s not clear if Biden will propose a permanent benefit or offer another short-term extension.

The Biden administration has yet to finalize details for the so-called American Families Plan, a major proposal that will address child care needs, paid leave and long-term care.

Economic advisers initially planned on a four-year extension of the child tax credit that would expire in 2025, The Washington Post first reported and HuffPost confirmed with two administration officials. However, the White House has been under pressure to make the benefit a permanent fixture of the nation’s welfare system.

The administration would not publicly confirm the details, which are expected to be announced ahead of Biden’s congressional address Wednesday.

Democrats significantly increased the child tax credit in March as part of the American Rescue Plan, which raised the value of the credit for families making $150,000 or less. That law also told the IRS to pay the money in advance, essentially transforming the credit into a child allowance.

Starting sometime after July 1, the IRS will send monthly checks to parents worth as much as $300 per child, or $3,600 per year.

Parents will stop receiving those checks after this year if Congress doesn’t pass another bill to continue them. Democrats have said all along that they would pass another bill to keep the checks going to families and that they would use the budget reconciliation process to bypass Senate Republicans if they had to.

President Joe Biden and first lady Jill Biden board Air Force One before departing from Andrews Air Force Base in Maryland onMANDEL NGAN via Getty Images President Joe Biden and first lady Jill Biden board Air Force One before departing from Andrews Air Force Base in Maryland on Feb. 27, 2021. 

Democrats have been calling on Biden to include the credit and other progressive priorities in his next proposal. Reps. Suzan DelBene (Wash.), Rosa DeLauro (Conn.) and Ritchie Torres (N.Y.), along with Sens. Sherrod Brown (Ohio), Cory Booker (N.J.) and Michael Bennet (Col.), last week called the child credit expansion “the most significant policy to come out of Washington in generations, and Congress has an historic opportunity to provide a lifeline to the middle class and to cut child poverty in half on a permanent basis.”

When Democrats expanded the tax credit in the American Rescue Plan, Biden indicated he wanted to make the program permanent — or at least last past than 2021. Democrats extended for only one year in order to reduce the bill’s cost, since the checks will go to the vast majority of households with kids and will cost roughly $100 billion a year.

If extended only through 2025, the child tax credit would join a long list of individual tax cuts expiring that year. Republicans opted against permanent changes in the 2017 Tax Cuts And Jobs Act, so lower tax rates for households will all expire in four years if lawmakers don’t extend them. Congress has a long tradition of enacting tax cuts on a temporary basis and then postponing their expiration dates indefinitely.

The current cost projections for Democrats’ child tax credit expansion is off the 2017 tax law’s baseline. That year, Republicans doubled the child tax credit to $2,000 a year through 2025. In terms of budget accounting, the cost of Democrats’ proposed program will increase significantly after 2025. That could make a difference if Democrats do pursue this proposal through budget reconciliation, which limits how much lawmakers can increase the deficit.

But Sen. Ron Wyden (D-Ore.), chairman of the Senate Finance Committee, said the tax-extender strategy would not be good.

“I don’t want to see this critical financial assistance expire along with Republicans’ tax giveaways for the top, which will make it easier for Republicans to hold working families hostage,” Wyden said in a statement.

Launching a monthly child benefit just three months after Congress passed a law is a major undertaking for the IRS. But Democrats have sought to seize on momentum from COVID-19 relief packages, which included direct payments that were so popular Congress itself received higher approval ratings as a result. The IRS has now had some practice sending checks to households, and Commissioner Charles Rettig told lawmakers this month that the child tax credit payments should start on schedule this summer.

“We fully expect to launch in July,” Rettig said during a Senate Finance Committee hearing. “We expect to launch with payments going out on a monthly basis.”

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