Congress Moves to Expand the Child Tax Credit

Happy Wednesday! Yesterday was an exciting day in the nation’s capital! No, there wasn’t any voting happening—Congress gave itself a snow day. But Capitol Hill is good for something besides the occasional lawmaking: It’s also an excellent spot to go sledding.  

Quick Hits: Today’s Top Stories

  • The U.S. military launched additional strikes against Iran-backed Houthi rebels in Yemen on Tuesday, U.S. Central Command (CENTCOM) announced yesterday—the third such barrage since late last week. U.S. forces targeted and destroyed four anti-ship ballistic missiles in an ongoing effort to secure Red Sea shipping lanes against continued Houthi attacks on commercial vessels. Houthi militants fired another missile following the U.S. strike, striking a Greek-owned, Maltese-flagged ship—which remained seaworthy and reported no injuries from the attack. Oil giant Shell announced Tuesday it would suspend travel through the Red Sea over spillage risks and crew safety concerns should one of their vessels be attacked. 
  • Meanwhile, CENTCOM confirmed yesterday that a search remains active for two Navy SEALs missing off the coast of Somalia after falling into choppy waters Thursday night. The pair were part of a team attempting to board a small boat, called a dhow, in order to seize Iranian weapons—including ballistic and cruise missiles—being illegally transported to Yemen. CENTCOM said it was the first such seizure since Houthi attacks on the Red Sea shipping lanes began in November of last year. 
  • Israel and Hamas reached a deal on Tuesday to allow additional medical aid into Gaza in exchange for medication being provided to some of the Israeli hostages Hamas and its allies are still holding in the Gaza Strip. Qatari and French negotiators helped broker the deal, which will see medication—purchased in France and shipped to Qatar, where it will be transferred to Gaza—delivered to approximately 45 hostages.
  • A federal judge on Tuesday blocked JetBlue’s $3.8 billion effort to acquire budget airline Spirit, arguing that the acquisition would disadvantage customers who rely on Spirit’s uniquely low prices. “If JetBlue were permitted to gobble up Spirit—at least as proposed—it would eliminate one of the airline industry’s few primary competitors that provides unique innovation and price discipline,” argued Judge William G. Young of the U.S. District Court for the District of Massachusetts. The ruling was seen as a win for the Biden administration after the Justice Department challenged the merger on antitrust grounds in March. Spirit and JetBlue responded to the ruling in a joint statement, saying the companies were considering “next steps as part of the legal process.”
  • Former Arkansas Gov. Asa Hutchinson dropped out of the 2024 Republican presidential primary on Tuesday after picking up just 191 votes in Monday night’s Iowa caucuses. Hutchinson—who was one of the few candidates to stridently and consistently criticize former President Donald Trump—had repeatedly failed to qualify for GOP debates, appearing in only the first debate last August. “My message of being a principled Republican with experience and telling the truth about the current front-runner did not sell in Iowa,” he said in a statement Tuesday. “I stand by the campaign I ran.”
  • Republican Sen. Chuck Grassley of Iowa is being treated for an infection, his office announced Tuesday. A spokesperson for the senator said Grassley, who is 90 years old, “is in good spirits and will return to work as soon as possible following doctors’ orders.”

Congress Tiptoes Toward a Tax Deal

House Ways and Means Committee Chairman Jason Smith presides over a hearing in the Longworth House Office Building on December 5, 2023, in Washington, D.C. (Photo by Win McNamee/Getty Images)
House Ways and Means Committee Chairman Jason Smith presides over a hearing in the Longworth House Office Building on December 5, 2023, in Washington, D.C. (Photo by Win McNamee/Getty Images)

A Democratic senator and a Republican congressman announced yesterday what has effectively become an endangered species in Congress: a bipartisan, bicameral legislative framework with provisions that are supported by a large number of Republicans and Democrats.

Sen. Ron Wyden, the Democratic chair of the Senate Finance Committee, and Rep. Jason Smith, the Republican chair of the House Ways and Means Committee, published on Tuesday their negotiated agreement to provide tax breaks for businesses and expand the Child Tax Credit (CTC). The framework reflects months of negotiations, and supporters of the bill want to push it through before the end of the month—in time for tax filing season. But the deal comes as House and Senate leadership try to avert a government shutdown, and it’s unclear if a tax package can pass both chambers.

The agreement, to be introduced as the Tax Relief for American Families and Workers Act of 2024, includes $78 billion in tax breaks and expanded credits. It would expand access to the CTC implemented under the 2017 Tax Cuts and Jobs Act (TCJA), which doubled the credit from $1,000 to $2,000 per child through 2025. It would also phase in an increase in the refundability of the CTC to allow low-income families to take full advantage of the credit. 

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