text: SECTION 1. SHORT TITLE; FINDING.
  
      (a) Short Title.--This Act may be cited as the ``Young Child Tax 
  Credit Act''.
      (b) Findings.--Congress finds the following:
              (1) Economists have found similar effects of the importance 
          of income in the earliest years with returns to school 
          achievement.
              (2) Pediatricians and other child development experts have 
          long talked about the critical importance of the earliest years 
          of life.
              (3) Young children, including babies and toddlers, are the 
          poorest people in the country by age.
              (4) With the recent improvements signed into law in 
          December, together, the Child Tax Credit and Earned Income Tax 
          Credit now lift more children out of poverty than any other 
          Federal policies.
              (5) Families with young children receive the smallest child 
          tax credits, despite the fact that the economic literature 
          suggests that these credits have particularly beneficial 
          effects for families with young children.
              (6) Economists have found that large fluctuations in a 
          family's income can be detrimental to the development of young 
          children. Research on scarcity have found it is hard for 
          parents to focus on children if they are worrying about having 
          sufficient income to meet their family's needs.
  
  SEC. 2. YOUNG CHILD TAX CREDIT.
  
      (a) In General.--Subpart C of part IV of subchapter A of chapter 1 
  of the Internal Revenue Code of 1986 is amended by inserting after 
  section 36B the following new section:
  
  ``SEC. 36C. YOUNG CHILD TAX CREDIT.
  
      ``(a) In General.--In the case of an individual, there shall be 
  allowed as a credit against the tax imposed by this subtitle for the 
  taxable year an amount equal to the product of--
              ``(1) the applicable dollar amount, multiplied by
              ``(2) the number of qualifying children of the taxpayer for 
          which the taxpayer is allowed a deduction under section 151 and 
          who (as of the close of such taxable year) have not attained 
          age 3.
      ``(b) Applicable Dollar Amount.--For purposes of this section, the 
  term `applicable dollar amount' means with respect to any taxable year, 
  the product of--
              ``(1) 1.5, multiplied by
              ``(2) the dollar amount in effect under section 24(a) for 
          the taxable year.
      ``(c) Limitation Based on Adjusted Gross Income.--
              ``(1) In general.--The amount of the credit allowable under 
          subsection (a) shall be reduced (but not below zero) by the 
          phaseout amount for each $1,000 (or fraction thereof) by which 
          the taxpayer's modified adjusted gross income (as defined in 
          section 24(b)(1)) exceeds the threshold amount (as defined in 
          section 24(b)(2)).
              ``(2) Phaseout amount.--For purposes of this subsection, 
          the term `phaseout amount' means 1.5 multiplied by the first 
          dollar amount in section 24(b)(1).
      ``(d) Qualifying Child.--For purposes of this section, the term 
  `qualifying child' has the meaning given such term by section 24(c).
      ``(e) Identification Requirement.--No credit shall be allowed under 
  this section to a taxpayer with respect to any qualifying child unless 
  the taxpayer includes the name and taxpayer identification number of 
  such qualifying child on the return of tax for the taxable year.
      ``(f) Reconciliation of Credit and Advance Credit.--
              ``(1) In general.--The amount of the credit allowed under 
          this section for any taxable year shall be reduced (but not 
          below zero) by the aggregate amount of any advance payments of 
          such credit under section 7527A for such taxable year.
              ``(2) Excess advance payments.--If the aggregate amount of 
          advance payments under section 7527A for the taxable year 
          exceed the amount of the credit allowed under this section for 
          such taxable year (determined without regard to paragraph (1)), 
          the tax imposed by this chapter for such taxable year shall be 
          increased by the amount of such excess.''.
      (b) Advance Payment of Credit.--Chapter 77 of such Code is amended 
  by inserting after section 7527 the following new section:
  
  ``SEC. 7527A. ADVANCE PAYMENT OF YOUNG CHILD TAX CREDIT.
  
      ``(a) In General.--As soon as practicable and not later than 1 year 
  after the date of the enactment of this Act, the Secretary shall 
  establish a program for making advance payments of the credit allowed 
  under section 36C on a monthly basis, or as frequently as the Secretary 
  determines to be administratively feasible, to taxpayers allowed such 
  credit (determined without regard to section 36C(f)(1)).
      ``(b) Limitation.--The Secretary may make payments under subsection 
  (a) only to the extent that the total amount of such payments made to 
  any taxpayer during the taxable year does not exceed the amount 
  determined under subsection (a) of section 36C with respect to such 
  taxpayer (determined without regard to subsections (c) and (f) of such 
  section). Such program shall make reasonable efforts to apply the 
  limitation of section 36C(c) with respect to payments made under such 
  program.''.
      (c) Conforming Amendments.--
              (1) Section 152(f)(6)(B) of such Code is amended by 
          striking ``and'' at the end of clause (iii), by striking the 
          period at the end of clause (iv) and inserting ``, and'', and 
          by adding at the end the following new clause:
                              ``(v) the credit under section 36C 
                          (relating to young child tax credit).''.
              (2) Section 6211(b)(4)(A) of such Code is amended by 
          inserting ``36C,'' after ``36B,''.
              (3) Section 6213(g)(2) of such Code is amended by striking 
          ``and'' at the end of subparagraph (P), by striking the period 
          at the end of subparagraph (Q) and inserting ``, and'', and by 
          inserting after subparagraph (Q) the following new 
          subparagraph:
                      ``(R) an omission of a correct TIN required under 
                  section 36C(e) (relating to young child tax credit) to 
                  be included on a return.''.
              (4) Section 6402(m) of such Code is amended by striking 
          ``or 32'' and inserting ``, 32 or 36C''.
              (5) Section 6695(g) of such Code is amended by striking 
          ``or 32'' and inserting ``32, or 36C''.
              (6) Section 1324(b)(2) of title 31, United States Code, is 
          amended by inserting ``36C,'' after ``36B,''.
              (7) The table of sections for subpart C of part IV of 
          subchapter A of chapter 1 of the Internal Revenue Code of 1986 
          is amended by inserting after the item relating to section 36B 
          the following new item:
  
  ``Sec. 36C. Young child tax credit.''.
              (8) The table of sections for chapter 77 of such Code is 
          amended by inserting after the item relating to section 7527 
          the following new item:
  
  ``Sec. 7527A. Advance payment of young child tax credit.''.
      (d) Effective Date.--
              (1) In general.--The amendments made by this section shall 
          apply to taxable years beginning after December 31, 2016.
              (2) Advance payment program.--The Secretary of the 
          Treasury, or his designee, shall establish the program 
          described in section 7527A of the Internal Revenue Code of 1986 
          (as added by this section) not later than such date.
target: Young Child Tax Credit Act This bill amends the Internal Revenue Code to allow individual taxpayers a new refundable tax credit based on the number of their qualifying children under the age of three and the taxpayer's adjusted gross income. Advance payments of credit amounts shall be made to taxpayers each month. 
feat_title: Young Child Tax Credit Act