The latest from Capitol Hill on a reconciliation package


August 26, 2022

On August 16, 2022 President Biden signed the Inflation Reduction Actalso known as the reconciliation bill, budget bill, and in previous forms as the Build Back Better Act. Now that the reconciliation process has concluded this page will no longer be updated. Visit our volunteer hub for up to date information, resources, and action items. 

President Biden Signs the Inflation Reduction Act 

On August 16, 2022, President Biden signed the Inflation Reduction Act (IRA) into law. RESULTS is pleased that the IRA makes historic investments to combat the climate crisis, helps to keep health insurance affordable, lowers prescription drug costs, and makes our tax code fairer. These new policies will help low-income Americans get the health care they need and take the first step towards creating an equitable tax code. 

However, we are disappointed that the IRA did not include the expanded child tax credit (CTC) that lifted millions of children out of poverty. Funding for access to affordable housing and global COVID relief were also left out of the final bill. For fuller analysis of the IRA see updates on this blog post from Aug 2 & 9.  

The CTC is an essential policy in our fight to end poverty, not including it in the IRA was a missed opportunity. Your fellow RESULTSer and Expert on Poverty Kali Daugherty agrees. She shared her experience with the CTC and her disappointment with the IRA in this statement from the ABC Coalition. Kali serves on the Parent Advisory Board for the coalition, which advocates for an “Automatic Benefit for Children”, also known as a child allowance, like the expanded CTC.  

While we did not get the CTC in the IRA, it is important to not be discouraged. We have spent the last year and a half advocating for the CTC expansion to be in this reconciliation bill and we have built a lot of momentum and support for the CTC as a result. Now, we must build on that momentum this fall and push for the CTC to be included in any end of year tax bill. We need to build broad bipartisan support in Congress, in the media, and in our communities. You can visit our Fall Campaign page for tools and resources to help you make the most of your advocacy, publish media, grow your groups, and more.  

As always, thank you for all you do! 

On August 7, the Senate voted to pass the Inflation Reduction Act (IRA) before going on recess. The Senate passed IRA bill is very close to what Sen. Manchin and Sen. Schumer initially proposed. It raises new revenue through a 15 percent corporate minimum tax, allowing Medicare to negotiate prescription drug costs, and providing additional funding to enforce existing tax laws that high-income earners easily evade. It makes historic investments to fight the climate crisis and extends Affordable Care Act subsidies so that insurance costs will not dramatically rise this fall. Additionally, roughly $300 billion will be used for deficit reduction. (See August 2 update on this thread for RESULTS’s full analysis of the IRA).

However, consideration of the IRA did contain some drama and the bill itself went through some last-minute changes before final passage. First, Sen. Sinema (D-AZ) withheld her vote to negotiate on behalf of private equity managers by successfully removing a tax provision that would have modified the “carried interest loophole. This was eventually replaced with a 1 percent tax on stock buybacks. Then, Senators debated and offered amendments during a marathon session over the weekend known as a “vote-a-rama”. Sen. Bernie Sanders (I-VT) offered an amendment to include the expanded CTC in the final bill but was voted down, with Sen. Sanders himself being the only vote in favor. Because the IRA was painstakingly negotiated between Sen. Manchin and Sen. Schumer, any amendments were being voted down by Democrats to preserve the underlying agreement (Manchin opposed the expanded CTC). While it is disappointing that the Sanders amendment failed, we are relieved that other amendments that would have made our work harder didn’t even receive a floor vote. 

One amendment that did not receive a floor vote was a “Research & Experimentation tax credit” which would send billions to big business (link to more information about this tax credit and why RESULTS opposed it). While RESULTS does not oppose R&E tax credits all together, we do oppose handing over billions of dollars to big businesses while millions of families struggle to put food on the table, find adequate and affordable housing, and pay the bills. RESULTS volunteers lobbied their senators in the final hours before the vote to oppose this tax credit (thank you for your advocacy!). Because the R&E tax credit was did not receive a vote, we have more negotiating power going into our fall campaign to include the expanded CTC in an end-of-year tax bill. 

We also want to update you on the status of the Dear Colleague letter from Rep. Jayapal. Rep. Jayapal’s office has informed us that this letter has been closed and advocacy on it has been paused. The letter urged Congress not to pass a budget reconciliation bill that includes the R&E tax credit, or any large corporate tax break, without expanding the CTC for struggling families. Thank you for your advocacy to get co-signers to the letter. As a result of that advocacy, the R&E tax credit was not included in the IRA – preserving a pathway forward to advocate for the CTC in a year-end tax bill. They expect to release a similar letter soon to again put pressure on Congress not to extend tax credits for big business without also helping families in the end-of-year tax bill. 

The IRA will now go to the House, whose members will be back briefly from recess, where it is expected to pass on Friday, August 12. Once passed, we anticipate that President Biden will sign the bill into law sometime next week. While RESULTS is pleased that the investments included in the IRA will address the climate crisis, make our tax code fairer, lower the cost of prescription medication, and keep health insurance affordable, Congress missed a huge opportunity to better the lives of struggling families. We need to continue working with Congress because The IRA did not include any of RESULTS’s priorities such as reinstating the expanded Child Tax Credit, investing in access to affordable housing, or providing global COVID relief funding. We will continue to advocate that families should come first and will keep you updated for further action.

Take action: Use our recently updated media action to keep the CTC in the media. Also, please join our U.S. Poverty Policy Forum on August 18 at 8:00 pm ET for more information on our CTC and housing work during fall 2022.

President Biden Signs the Inflation Reduction Act 

On August 16, 2022, President Biden signed the Inflation Reduction Act (IRA) into law. RESULTS is pleased that the IRA makes historic investments to combat the climate crisis, helps to keep health insurance affordable, lowers prescription drug costs, and makes our tax code fairer. These new policies will help low-income Americans get the health care they need and take the first step towards creating an equitable tax code. 

However, we are disappointed that the IRA did not include the expanded child tax credit (CTC) that lifted millions of children out of poverty. Funding for access to affordable housing and global COVID relief were also left out of the final bill. For fuller analysis of the IRA see updates on this blog post from Aug 2 & 9.  

The CTC is an essential policy in our fight to end poverty, not including it in the IRA was a missed opportunity. Your fellow RESULTSer and Expert on Poverty Kali Daugherty agrees. She shared her experience with the CTC and her disappointment with the IRA in this statement from the ABC Coalition. Kali serves on the Parent Advisory Board for the coalition, which advocates for an “Automatic Benefit for Children”, also known as a child allowance, like the expanded CTC.  

While we did not get the CTC in the IRA, it is important to not be discouraged. We have spent the last year and a half advocating for the CTC expansion to be in this reconciliation bill and we have built a lot of momentum and support for the CTC as a result. Now, we must build on that momentum this fall and push for the CTC to be included in any end of year tax bill. We need to build broad bipartisan support in Congress, in the media, and in our communities. You can visit our Fall Campaign page for tools and resources to help you make the most of your advocacy, publish media, grow your groups, and more.  

As always, thank you for all you do! 

On July 27, Senators Joe Manchin (D-WV) and Chuck Schumer (D-NY) released a joint statement revealing that they had come to an agreement on a new budget reconciliation bill, known as the Inflation Reduction Act of 2022 (IRA) (full text and executive summaries of key provisions). The bill is currently being reviewed by the Senate Parliamentarian to ensure it meets the budget guidelines for reconciliation. It will then be up for debate in the Senate, likely this week, and may be voted on as early as this weekend. RESULTS is deeply disappointed that the expanded Child Tax Credit that did so much to reduce child poverty was not included in the agreement. We are also disappointed that global COVID relief funding and housing were not addressed.  

Promising Provisions: However, there are some things to be excited about in the bill. The IRA, for the first time in history, will allow Medicare to negotiate prices for many commonly used prescription drugs, thus lowering prices for American families. It also extends Affordable Care Act subsidies for low-income families so that they can afford health insurance. Without this provision, insurance premiums would have increased for millions of families this fall. The IRA also makes a historic investment of $369 billion towards combating the climate crisis. According to initial analysis by Rhodium Group, its passage would put the U.S. on a credible path to achieving a roughly 40% emissions reduction by 2030. 

The IRA is partially paid for by raising revenue through the tax code. RESULTS has been working with coalition partners to make our tax code more equitable, and this bill makes some considerable progress towards that goal. It creates a 15 percent minimum tax on large corporations. It makes changes to the “carried interest loophole” which, according to the New York Times, “allows wealthy hedge fund managers and private equity executives to pay lower tax rates than entry-level employees”. While the changes made do not close the loophole entirely, they do make modest steps towards greater fairness in our tax code. The IRA also increases funding for the IRS by $124 billion over 10 years. These changes together are expected to raise $451 billion over the next decade.  

As to the IRS funding, the IRA appropriates $3.1B for taxpayer services, $45.6B for enforcement, $25.3B for operations support and $4.7B for business systems modernization. Additional customer service and taxpayer advocacy services will help low-income families access tax benefits and ensure taxpayers and business owners get the help that they need. More enforcement means high-income earners who can more easily evade taxation, will have to pay their fair share. For example, audits on millionaires have fallen 71 percent between 2010-2021 because of lack of funding.  

RESULTS Concerns: So, while we are encouraged by what is in the IRA, we are equally disappointed by what is not. Particularly, a bill to expand the CTC. That is why we will be pushing our members of Congress over the coming months to include the expanded CTC in any end-of-year tax legislation. The CTC made such massive progress towards ending child poverty in America that it would be shameful not to reinstate it now. That is particularly true as large corporations will be seeking to extend corporate tax breaks that expire at the end of the year. We must not allow Congress to extend these benefits without reinstating the expanded CTC for families. 

Take Action: We need to keep CTC in the media so our members of Congress know their constituents care about helping struggling families. You can submit an LTE here. If you can, personalize your message with your own experiences, it will make a stronger argument and increase your likelihood of being published.

This month, RESULTS advocates around the country are meeting with their members of Congress, discussing Child Tax Credit (CTC) provisions that lifted nearly 4 million children out of poverty from July to December 2021. The CTC monthly payments from 2021 were a financial lifeline for millions of American families. 27 million children in the lowest-income families who had previously received no or little help got the full CTC for the first time. And it worked. Child poverty went down, hunger went down, housing instability went down, and family stress went down.

Last Friday, President Biden confirmed reports that the CTC (Child Tax Credit) is unlikely to be included in a reconciliation packageRESULTS volunteers did some amazing work over the past 1.5 years to push for the CTC to be a priority and we know this is heartbreaking news for many of you — and for the millions of families struggling to put food on the table and keep stably housed. We are building on your efforts in the months ahead.

In particular, this makes the longer-term work of building broad bipartisan support for the CTC that we’ve shared over the past month even more critical. Luckily, there is growing bipartisan interest in reducing child poverty via monthly payments, with a new proposal from Sens. Mitt Romney (R-UT), Richard Burr (R-NC), and Steve Daines (R-MT) released last week. On Tuesday, June 14, over 100 RESULTS volunteers organized 100+ of lobby meetings in Washington, DC to talk about the CTC – focused on the short-term goal of extending the expanded CTC, and the long-term goal of building broad bipartisan support to reduce child poverty, flagging the pending Romney proposal with many offices. With these latest developments, your lobby meetings and follow-up in the coming weeks can make a big impact!

TAKE ACTION: Here are the actions you can take to help with the Child Tax Credit this year:

  • For Democrats. Ask them to speak to House Speaker Nancy Pelosi (D-CA) and Senate Majority Leader Chuck Schumer (D-NY), telling them to make the extension of the CTC with permanent full refundability and the monthly payment option a priority in legislation this year. Given the news that negotiators will not include the CTC in reconciliation, ask what their plan is to get this done in 2022.
  • For Republicans. Ask them to review the new “Family Security Act 2.0” proposal (see overview in Quick News) from Sens. Mitt Romney (R-UT), Richard Burr (R-NC), and Steve Daines (R-MT). RESULTS does not have an official position on the proposal (we like some parts, have serious concerns about others), but we’re seeing our legislators’ feedback. This is our chance to build support amongst conservative members of Congress, knowing that Congress is likely to revisit bipartisan tax legislation later this year.
  • For all. Attend the Child Tax Credit Legislative Update and General Office Hour at 1 pm ET on Wednesday, June 22. Join with no registration required.

Please see our Advocacy Month Resources page for all the materials you need to schedule, prepare, and execute powerful lobby meetings this month – including talking points for different policymakers, a long-term CTC leave behind document, and an updated background memo. In addition, RESULTS policy staff will host a special Legislative Update/General Office Hour tomorrow, June 22, at 1 pm ET to talk through the latest developments and answer questions. Feel free to contact RESULTS staff with additional questions or for specific lobby coaching.

This month, RESULTS advocates around the country are meeting with their members of Congress, discussing Child Tax Credit (CTC) provisions that lifted nearly 4 million children out of poverty from July to December 2021. The CTC monthly payments from 2021 were a financial lifeline for millions of American families. 27 million children in the lowest-income families who had previously received no or little help got the full CTC for the first time. And it worked. Child poverty went down, hunger went down, housing instability went down, and family stress went down.

Meanwhile, as negotiations intensify on a possible reconciliation package, on Tuesday over 100 RESULTS volunteers organized 100+ of lobby meetings in Washington, DC to talk about the CTC – focused on the short-term goal of extending the expanded CTC, and the long-term goal of building broad bipartisan support to reduce child poverty. Advocates had a powerful day on the Hill. We urge you to continue that momentum by meeting with your members of Congress back home. Congress will be in DC this week but then back home from June 27-July 8. Make the most of this time by requesting face-to-face meetings with them to talk about the CTC. If you cannot meet with members themselves, set up meetings with their tax aides.

These meetings are in the midst of ongoing conversations on a reconciliation package — and growing bipartisan interest in reducing child poverty via monthly payments. On Wednesday, Senator Mitt Romney (R-UT) released the The Family Security Act 2.0 (FSA), which provides $4,200/year for children 5 and under and $3,500 for children 6-17 (by comparison the American Rescue Plan (ARPA) CTC was $3,600 and $3,000 for same age groups). It also provides $700/month to families during the final 4 months of pregnancy. Families become eligible for benefits starting at their first dollar earned and become eligible for the full benefit at $10,000 earned. These monthly payments would be administered by the Social Security Administration. RESULTS commends Senators Romney, Daines (R-MT), and Burr (R-NC) for moving forward the conversation about policies that can reduce child poverty.

RESULTS concerns: while the benefit amount and monthly payments are improvements over the ARPA CTC, RESULTS continues to advocate against income requirements that would limit the ability of families with limited or no income to get the CTC. It is, however, important to note that the income requirement in the FSA is a huge improvement over the current CTC which requires families to earn much more for full eligibility (roughly $30,000) and is not available at all to families making under $2,500. Given the work done to administer monthly payments through the IRS, RESULTS is concerned about moving administration to the SSA – which could impact access to other anti-poverty programs. And, the FSA requires that at least one parent possesses an SSN – another step backwards from current law.

Problematic payfors: The FSA pays for the additional benefits it provides in a few ways, most of which are problematic. In particular, the FSA cuts the EITC and the eliminates of the head-of-household deduction. Chuck Marr from CBPP calculated that a single mother making $25,000 with 2 children would see her yearly income drop by $450, even with the increased CTC benefit amount.

We are cautiously optimistic that this proposal can start a bipartisan conversation around the permanent expansion of the CTC. We urge you to share information about the new proposal – including RESULTS concerns about those left behind in the FSA and the cuts to EITC, etc. – with policymakers in your lobby meetings and follow up.  With your advocacy including your meetings this month, we can make our tax code stronger and more equitable to ensure it has the greatest impact in reducing poverty.

Please let us know if you have questions – and please keep filling out those lobby reports!

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