Make Temporary Tax Change Permanent to Benefit Families with Children
There is no more important work than that of helping young people grow into thriving adults. Nobody puts more work into any one child or youth than that child’s parents or lead caregivers. And it’s time to make sure that every family gets more help with the work of raising kids by creating a permanent federal cash benefit for every family through the Child Tax Credit.
In 21st Century America, the cost of having children is growing. Health care is costly; child care is either hard to piece together or mind-blowingly expensive; transportation, from insurance to transit, can stress families out even more than child care. Families with means invest their money in making their children educationally and economically competitive, through out-of-school learning programs, technology, and other advantages. Income inequality in Michigan has risen between most families and the wealthiest, and its consequences threaten the prospects for future generations.
So why not just give families more money, to recognize the increased costs of having children?
America theoretically rewards hard work, but work done “in-home” to raise good people has historically been far less rewarded than “employed” work. Caregivers, women especially, and especially-so women from underserved racial and ethnic groups, were and continue to be exposed to income inequality, and poor outcomes that come with it.
One of the greatest tools we have for supporting the work of parenting is the Child Tax Credit (CTC). Before the pandemic, the CTC delivered $2,000 to each family for each child up to age 17, phasing out between $200-400,000. For families with incomes low enough to not pay federal income tax, the credit was “refundable: up to $1,400.” While the CTC has grown some since its 1998 creation, it still was leaving a wide gap in families’ budgets.
In March 2021, the CTC was expanded to $3,000 per child, including $3,600 for children six or under. It was expanded to include all low-income families, regardless of whether their income is high enough to pay federal income tax; and modified so that families can receive it monthly if that works better for their budgets. These payments will run out at the end of this year (December 2021), but there is plenty of precedent for making a “temporary” tax change more permanent.
The burdens of raising children for individual families are great and growing more demanding. We can help position every family to succeed by enacting a permanent, large, refundable child tax credit and deliver thousands of dollars in cash assistance to each American family. Congress can make the CTC permanent right now, in whatever legislation they pass next to help rebuild our economy.
In this moment of change, we are compelled to help every child thrive and succeed. The CTC must be an essential tool for protecting families from poverty and instability.
Happy Child Tax Credit Day! May the Child Tax Credit live long, may it grow, and may it reach as many people as possible!
Learn more about the new Child Care Tax Credit in this one-pager from childcarecredit.gov. Also, access more information about the tax credit, including access to information in multiple languages other than English, from Poverty Solutions at the University of Michigan.
Bobby Dorigo Jones is the Policy Director for Michigan’s Children. Reach him at email@example.com.