On Friday, we learned that the website that poor people are supposed to use to claim the Biden Child Tax Credit (CTC) has been shut down. The reason for the shut down is that some people who are supposed to file normal taxes may end up first using this non-filer website, which would create tremendous processing headaches for the IRS as well as bureaucratic nightmares for the filer.

If people used the non-filer portal to try to claim the rest of the money and then later filed a full return, for example, they would be flagged by the agency for filing two returns, something that is not allowed. (People wanting to make changes to a return are required to file amended returns.)

“Last year, since the filing season had already ended, those mistakes were kind of no harm, no foul,” said Sperling. “But if that happened at the beginning of the filing season this year, these families would get through the Child Tax Credit portal and then when they try to do their normal tax filings, they would look like they were trying to file their taxes twice.”

“That could lock them out of any benefits for months while the IRS tries to sort out their situation.”

This problem is a direct result of decisions Democrats made when designing this program. Over a year ago, we warned that administering a child allowance through the IRS as an advanced refundable tax credit would be a mess, especially for poor families.

Families with very low incomes are not required to file taxes, but cannot access CTC benefits unless they do so. Initially, this conundrum caused participation problems as poor families had to take an extra and confusing step to sign up as non-filers. Only a handful actually did so.

Now, this tension has caused administrative problems as people who were too poor to file taxes last year are not necessarily too poor to file taxes this year. Advanced monthly payments were paid out based on the family’s situation last year but actual eligibility and then payment reconciliation is based on the family’s situation this year. Non-filers who become filers may end up reasonably confused about how to claim the rest of their CTC and end up wrongly going back to the website they used last year. So now this website has been closed. This closure ensures nobody improperly files as a non-filer but also locks out those who actually should be filing as a non-filer.

For now, it looks like the Biden CTC wont be extended beyond the 2021 tax year. But if we ever get to some point in the future where a permanent child allowance is on the agenda, we should learn from these design mistakes. Trying to run a child allowance program through the tax system is a recipe for disaster. The IRS is not a welfare agency and the tax system is not designed to to provide benefits to people who are not required to file taxes.

The obvious and best way to administer a child allowance program is to have the Social Security Administration pay a universal cash benefit to every child every month without regard to family income, marital status, or similar. The SSA can sign kids up at birth when they already register with the agency and can provide monthly benefits throughout entire childhoods without any other interaction with the agency.

This is how the End Child Poverty Act introduced by Rashida Tlaib and Mondaire Jones works and it is how any future Democratic efforts in this area should be designed.