Bush, House Weigh In on Revised Child Tax Credit

What started out as a rather benign adjustment to the recent tax legislation - a change in the Child Tax Credit to make it a refundable credit instead of a credit against existing taxes so that more lower-income families would receive money from the government - has turned into a political controversy, pitting the House Republicans against members of the Senate who passed a version of the bill last week.

The Senate bill affects this summer's scheduled tax rebate by making the $1,000 Child Tax Credit refundable and the scheduled $400 rebate payable to families even if they didn't pay income taxes in 2002.

House Republicans are interested in passing a similar bill but only if they can attach the revised Child Tax Credit to legislation that would make the new $1,000 Child Tax Credit permanent. Current law requires that the Child Tax Credit be reduced to $700 in 2005.

The Senate version of the bill would cost the government $10 billion over the two years it covers. The House bill would cost $100 billion over the next 10 years.

The White House is urging passage of at least the Senate version of the bill. White House spokesman Ari Fleischer said President Bush is anxious to have this bill on his desk. "He wants to sign it," Mr. Fleischer said at a press briefing on Monday.

If either the House or Senate version of the bill becomes law, some changes to the previously posted rebate dates will occur. Depending on how the rebate to lower-income families will be disbursed, either the entire summer rebate program which was scheduled to launch on July 25 will be delayed a month, or the new rebates for lower-income families will be delayed until September.

Related story: Senate Bows to Pressure, Extends Child Care Credit to Low Income Families

You may like these other stories...

By Cathy Stopyra and Todd SimmensUnderpayment interest, refund interest, and penalties charged to businesses are just a few of the considerations the IRS calculates when determining taxation for a given company. Though...
FASB mulling a revamped income statementDavid M. Katz of CFO wrote on Tuesday that the Financial Accounting Standards Board (FASB) is in the early stages of researching whether to launch a project aimed at improving and...
Renaissance avoided more than $6 billion tax, report saysThe Senate Permanent Subcommittee on Investigations said on Monday that a Renaissance Technologies LLC hedge fund’s investors probably avoided more than $6...

Upcoming CPE Webinars

Jul 24
In this presentation Excel expert David Ringstrom, CPA revisits the Excel feature you should be using, but probably aren't. The Table feature offers the ability to both boost the integrity of your spreadsheets, but reduce maintenance as well.
Jul 31
In this session Excel expert David Ringstrom helps beginners get up to speed in Microsoft Excel. However, even experienced Excel users will learn some new tricks, particularly when David discusses under-utilized aspects of Excel.
Aug 5
This webcast will focus on accounting and disclosure policies for various types of consolidations and business combinations.