Child Poverty

The Child Tax Credit: Here to Help

For millions of American families struggling to make ends meet, help is on the way. The Child Tax Credit (CTC) was created in 1997 to help families meet their everyday expenses raising children but often failed to reach the poorest families who needed it most. Happily, that has been changed with the American Rescue Plan Act (ARP) passed by Congress and signed into law by President Biden. It includes a one-year CTC expansion providing guaranteed income for children in nearly 90 percent of American families beginning July 15th. Married couples with incomes up to $150,000 and single household heads with incomes up to $112,500 can receive up to $300 a month for each child under six and $250 a month for each child ages 6-17 with automatic monthly payments. This will ensure greater economic security and flexibility for families and make a down payment towards ending child poverty and advancing racial equity in our nation. I urge President Biden and Congress to make it permanent immediately!

June 21 was “Child Tax Credit Awareness Day,” with the White House, Congressional leaders, the Children’s Defense Fund, and organizations all across our country raising awareness about CTC changes and how families can access its expanded benefits. Please help us share the good news. Previously many millions of families did not qualify for the CTC because they earned too little. But thankfully, the American Rescue Plan extends the CTC to 23 million children, disproportionately children of color, who were previously left out and behind in poverty. The American Rescue Plan is projected to cut child poverty by half in 2021 if well implemented with the one-year CTC expansion accounting for the vast majority of the bill’s poverty-fighting effect. Its impact on racial disparities is dramatic, with poverty falling 52 percent for Black children, 45 percent for Hispanic children, 37 percent for Asian American and Pacific Islander children, and 62 percent for Native American children.

The American Rescue Plan Act has also made it easier for eligible families to access payments. They can receive a cash benefit “advance” for half the credit through six monthly payments beginning July 15th. Families who file taxes with the IRS will automatically receive payments as they have received tax refunds or economic stimulus payments. Newly eligible families with little or no income who don’t file tax returns must use the IRS Child Tax Credit Non-Filer Tool.

CDF has fought to make the CTC available to all families struggling to make ends meet. I cannot express my gratitude enough to those members of Congress who sponsored and ensured the enactment of this crucial safety net for children like Representative Rosa DeLauro (D-CT), who first introduced a bill to expand the CTC to our poorest children in 2003. On the day the expansion was signed into law she said: “You think about why you serve, and you think about what motivates you. … This bill is going to transform the lives of families today.” We must keep moving ahead until no child in America is left behind in poverty.

Learn more about what the expanded CTC means for your family here, and share the information with friends, family, congregations, schools, community members, and members of the media who may be unaware of this crucial benefit which will expire at the end of the year unless we act. Please communicate by all means necessary with your members of Congress to tell them to protect this essential benefit for children and families. We must urge President Biden and Congress to make the CTC expansion permanent.