Print Friendly, PDF & Email

Childhood Poverty Rates Cut in Half over the Past Year by About-to-Expire Child Tax Credit

This week the last Child Tax Credit (CTC) payments go out to working families, first enacted during the COVID-19 crisis by the Biden Administration’s American Rescue Package (June, 2021) to help working families survive the pandemic economic crisis. Most families (those making below $400,000 in annual income) have been automatically receiving monthly payments of $250 or $300 per child without having to take any action. But the tax credit expires Dec. 31, 2021.

Colorado U.S. Senator Michael Bennet (D), who for years has led the campaign for this working families tax credit as a way to help lower and middle-income families stay above the poverty line and provide stability around America’s children, says this just should not happen.

The American Rescue Plan increased the Child Tax Credit from $2,000 per child to $3,000 per child for children over the age of six and from $2,000 to $3,600 for children under the age of six, and raised the age limit from 16 to 17. All working families get the full credit if they make up to $150,000 for a couple or $112,500 for a family with a single parent (also called Head of Household).

Come January, the child tax credit that has lifted 61 million U.S. children out of poverty — cutting childhood poverty rates in half in less than a year, will be gone. That is, unless the Build Back Better bill gets passed in some form by the senate. The $71 billion program is currently included in that omnibus bill. But it may not remain in its present form as passed by the U.S. House of Representatives.

That most Americans seem oblivious to the economic support this has placed around families this past year, has become obvious. Working parents know that the bill has helped their families not go hungry, cutting childhood hunger by 25 percent. The monthly checks per child, have paid for rent, for childcare so that working parents, including moms, could go back to work. In the midst of the public health crisis that brought on the economic crisis, the support for children has eased family turmoil during a terrible time.

The checks for the first time have allowed low-income families, some of whom make so little that they don’t even file tax returns, to actually receive a stabilizing base to support their children.

U.S. Senator Michael Bennet

Yesterday, Bennet spoke on the floor of the U.S.Senate Chambers, urging senators that if the Build back Better bill itself isn’t passed before Christmas, that the child tax credit component should be extended on its own, so families don’t miss the January payment.

He was joined by U.S. Senators Tim Kaine (D-Va.), Cory Booker (D-N.J.), Sherrod Brown (D-Ohio), and Catherine Cortez Masto (D-Nev.) on the Senate floor calling for swift passage of a one-year extension and permanent full refundability of the Child Tax Credit (CTC) through the Build Back Better budget. In his speech, Bennet highlighted stories from Coloradans about how this benefit is helping their families.

“This is April Pratt from El Paso County. And she lives there with her three daughters who are ages eight, two-and-a-half and one-and-a-half. When April was pregnant with her youngest daughter, her husband tragically passed away. Now she’s the sole breadwinner for the family, and although she works full time at the local school, there’s not much left after her mortgage, diapers, and groceries for three young kids,” said Bennet. “Before the Child Tax Credit, April said she, ‘felt like I was having a lot of anxiety every month about whether I was going to be able to afford my bills. It was eating up a lot of my attention.’ And thanks to the Child Tax Credit, April can afford the $1,200 a month for childcare for her two youngest daughters so she can work.”

Starting today, Colorado families will begin receiving their December advance monthly CTC payment. Thanks to this tax credit expansion under the American Rescue Plan Act, based on Bennet’s American Family Act, the CTC has already helped millions of children nationwide, including 27 million children who were previously excluded from the tax credit because they had no tax filing through which to receive a refund. Bennet and the senators are fighting to ensure those kids will permanently be eligible for the CTC and for a 1-year extension of the credit through Build Back Better.

“Now we’ve got a tax cut for working people …We’re saying we don’t have to accept childhood poverty as a permanent feature of our economy or our democracy,” Bennet continued. “We don’t have to accept an economy where it only grows for the wealthiest Americans. We don’t have to accept a Congress that is only paying attention to special interests and to the wealthiest Americans. We can build an economy that includes everybody.”

Bennet’s full speech is available HERE. Among his full remarks, in which he referenced Senate President Kamala Harris are the following:

Photo by Kate J for the teaching website:

“… The United States, before we passed this, was 38 out of 41 industrialized countries in the world when it came to childhood poverty. The poorest generation in this country are our children and I think, what we said was, there is no reason for us to accept those outcomes or those numbers as a permanent feature of our economy or our democracy. And in the end, this isn’t about numbers.

This is about children all over our country and the future of the United States of America. Childhood poverty, Madam President costs this country a trillion dollars a year. And one of the things we decided was maybe instead of paying for the effects of childhood poverty, we could actually begin to try to reduce the amount of childhood poverty that exists in our country the way other countries around the world have already done it.

…When’s the last time we were able to come to the floor of the Senate and say we’ve cut hunger in this country by a quarter? It’s been generations since anybody’s been able to say that on this floor. In Colorado, Madam President, a million kids, and their families are benefiting from this credit.

That’s 90 percent of the kids in my state, it’s 90 percent of the kids across the country. Parents in Colorado are getting an average of $240 a month to pay for groceries to help with the rent — really importantly, to pay for a little extra child care so people can stay at work. And I know that because of what parents have told me they’re spending the money on.”

Finally, Madam President, after we have cut taxes for the wealthiest people in this country by more than $5 trillion since 2001, we finally have a tax cut for working families. We should be making it permanent, Madam President.”

Bennet went on to describe working families in Monte Vista, Colorado Springs, and El Paso County who were able to go back to work knowing their children were cared for as a result of the CTC.

West Virginia Senator Joe Manchin (D) has expressed opposition to the CTC act, one of two Democratic senators who are stalling the Build Back Better bill in a nearly equally-divided U.S. Senate.