NEW YORK NOW – As payments from the expanded federal Child Tax Credit start this week, Rep. Paul Tonko, D-Albany, says the credit should be made permanent.
The Child Tax Credit was a part of the federal American Rescue Plan, which was a response to the financial impacts of the COVID-19 pandemic.
Payments will vary depending on household income, but eligible households will receive up to $360 per month for each child up to 6 years old, and up to $300 monthly for each child between 6 and 17 years old.
When it comes to making the credit permanent, Tonko said the case is easy to make.
“Building a strong economy means building strong households, and as we share these benefits, the economy is strengthened, because people are going to invest in essentials,” Tonko said.
“The Earned Income Tax Credit Demonstrates that time and time again.”
Dr. Leigh Wedenoja, the senior policy analyst at the Rockefeller Institute of Government, said the payments will have a different effect when compared to previous lump sum payments from Child Tax Credit expansions, and Earned Income Tax Credit expansions.
“Sixty-three percent of Earned Income Tax Credit recipients spent some, or all of their payment on paying down debt,” Wedenoja said.
“Monthly payments will allow families to accumulate less debt, to default on fewer bills, and potentially get out of systems of debt and repayment, and prevent things like eviction, especially coming through COVID-19 recovery.”
As far as who is eligible for the expanded federal Child Tax Credit, Wedenoja said the income limit is $150,000 for married or filing jointly, $112,500 for head of household, and $75,000 for filing a single filer.
Shana Davis, an Albany County resident who was at today’s event who’s raising her teenage grandchild, said she’ll benefit personally from the expanded Child Tax Credit.
“This can be a difference in paying a light bill, or paying the car payment this month. It can be a difference in working part time, or being able to be home with my child to support them,” Davis said.
Senate Majority Leader Chuck Schumer previously said in April of this year that the expanded Child Tax Credit would reduce childhood poverty statewide by 50%, as the payments are fully refundable.
The payments start going out on Thursday, and elected officials are encouraging eligible New Yorkers to apply for assistance on the federal Child Tax Credit website.