Biden, Democrats may limit free college, childcare to shrink reconciliation bill: sources

By Jarrett Renshaw

Sept 27 (Reuters) - The White House and U.S. Democrats are weighing attaching or strengthening income caps to a number of key agenda items, including electric vehicle rebates and free community college, to shrink the $3.5 trillion reconciliation bill and pacify spending hawks, according to two officials familiar with the discussions.

Discussions about these income limits, known as means tests in Washington lingo, come as Democrats struggle to agree on the size of the sprawling $3.5 trillion social safety net and climate change package, a signature piece of President Joe Biden's agenda.

The White House did not respond to requests for comment.

The Biden proposal outlined earlier this year included free community college, expanded child tax credits and universal preschool for any U.S. citizen, but Democrats are now considering whether to cap eligibility based on income, the two sources told Reuters.

They're also discussing limiting who can receive tax credits for electric cars.

The White House, for example, want to create a $7,500 tax credit for any taxpayers who purchase electric cars.

A House Democratic version of the bill said individual taxpayers must have an adjusted gross income of no more than $400,000 to get the credit, but Senate Democrats are considering a lower threshold that could go as low as $100,000, sources said. (Reporting By Jarrett Renshaw; Editing by Heather Timmons and Jonathan Oatis)