The Child Tax Credit: A Proven Investment to Lift Millions of Children Out of Poverty

On July 15th, the parents of 60 million children throughout America began receiving monthly checks as part of the Child Tax Credit (CTC). This historic program is projected to cut child poverty in half and could be yet another powerful example of how universal basic income programs can uplift families and rebuild our economy. “This is a lifeline for a lot of people, especially those in poverty who stand to get an average of $4,300 per family,” shared Representative Lori Trahan on a panel earlier this month. 

“The way we have been administering public assistance for 50 years since we launched the War on Poverty is not working. We’ve lost the war, and now it is time to rethink how the safety net and benefits are deployed,” said Bob Giannino, Asin President & CEO of United Way of Massachusetts Bay and Merrimack Valley.

The goal of the expanded CTC is to help families meet the costs of child care and other essential needs.  Between now and December, 39 million families are projected to receive monthly advance payments of up to $300 per child, with the remaining balance paid after filing taxes the following spring. The impact extra financial support can have is tremendous, helping families pay for anything from basic needs like diapers and food to child care and school supplies. Moreover, increased financial support to cover child care needs will help make it possible for all of our neighbors to get back to work. 

“After housing, the high cost of child care is a significant barrier to able-bodied low-income Lawrence working parents. In many cases, parents of young children are forced to make the decision not to work because they are unable to access reliable and affordable child care. The Child Tax Credit can make a significant dent in addressing this problem and allow more parents with young children to enter the workforce,” shared Juan P. Bonilla, Chief Operating Officer of Lawrence CommunityWorks, Inc.

Raising awareness will be crucial 

In Massachusetts alone, 58,000 eligible children may miss out. This has raised a four alarm fire among advocates and community organizers alike who are determined to see that the credit gets into the hands the families who need it most.  

The CTC comes baked into the tax code so every eligible family that filed taxes last year  around 92% of all households with children — will automatically receive it. But the families who could benefit the most from this cutting-edge credit are often the same families who don’t file taxes. This includes many households that make less than $12,400 annually. To address this barrier, the IRS launched a streamlined sign-up tool to check for eligibility and enroll in the expanded Child Tax Credit.  

Ensuring families are aware of the credit is a crucial piece of the puzzle. In Boston, United Way is partnering with The Mayor’s Office of Financial Empowerment and other local organizations to reach out to eligible families and ensure that an estimated 5,100 Boston children do not miss out on dollars crucial to their care and well-being.  

“The Child Tax Credit is a precious opportunity for families to gain their financial footing and provide the best they can for their children,” said Acting Mayor of Boston Janey. “This money can make a world of difference, whether it’s for essentials like food and diapers, quality child care, or savings for college.”

In partnership with the Children’s HealthWatchGreater Boston Legal ServicesMassachusetts Association for Community Action (MASSCAP), and the Massachusetts Law Reform Institute (MLRI), the Shah Family Foundation is also working to raise awareness through a newly launched website called Find Your Funds. The larger goal is to help families access all available federal funding.  

“Thousands of families across Massachusetts are eligible for significant cash assistance from the federal government, but unfortunately a good amount of that money is being left on the table,” said Jill Shah, President of the Shah Family Foundation. “Whether it’s because they don’t know about these programs, don’t know how to apply, or simply don’t know where to go for trustworthy information, addresses these common barriers and helps ensure every Massachusetts resident gets the money available to them.”

Moreover, many advocates are calling on federal leaders to make this expansion permanent. This round of payments alone has the potential to lift millions out of poverty – but the expansion is only set to run for one year. Stand with us in urging Congress to pass Biden’s American Families Act. Together, we can fight to make the expanded Child Tax Credit permanent. Take action here. 

Accessing your Child Care Tax Credit 

Online tools to access your credit 

Community organizations offering assistance 

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