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A new expanded child tax credit would include families who need it most

MARY LOUISE KELLY, HOST:

Last night Congress cooperated for American children. In a rare moment of bipartisanship, the House overwhelmingly passed a tax bill. Inside that tax bill was a three-year expansion of the child tax credit. Now, if it passes a Senate and it's signed by the president, that extra money would help millions of children in low-income households. Just to remind, during the pandemic, a similar program was credited with making a huge improvement in U.S. child poverty and hunger. That one was bigger. It was distributed throughout the year as monthly deposits, and it expired at the start of 2022. Kris Cox is the deputy director of federal tax policy at the nonpartisan Center on Budget and Policy Priorities. Hey there.

KRIS COX: Hi, Mary Louise.

KELLY: So if this new child tax credit becomes law, how many children would benefit?

COX: So the proposal would boost the incomes for 16 million children across the country. That's really significant. And that's more than 80% of the children who are currently left out of the full credit.

KELLY: And explain that - 80% that are left out of the full credit. Is this because their families' incomes are too low to be filing taxes to get a credit against?

COX: That's exactly right. So the child tax credit delivers $2,000 per child to families with middle and upper incomes, but children and families with lower incomes get less than that. So across the country, more than 1 in 4 children get less than the full credit because their families earn too little. And that's as upside down as it sounds. But this proposal targets help to those children, and more than 80% of them will see their credit go up.

KELLY: And when we say they would get a boost, they would get a benefit, how many of those children would be lifted above the poverty line?

COX: So in the first year, this proposal would lift as many as 400,000 children above the poverty line. And it would provide additional financial resources to an additional 3 million children who are living in families with incomes below the poverty line.

KELLY: Yeah. We're throwing a lot of numbers around, and I just want to try to make this real. The analysis that your organization did gives an example of a single parent, two young kids. This parent makes $13,000 a year. How does this help her?

COX: This is a really significant income boost. So for someone making about $13,000 a year, a single parent with two young kids, under current law, she gets about $1,600 in total for both of her kids, so far less than half of what a family with higher income would get. Under this proposal, her credit would double. Imagine a security guard who earns around $30,000 and whose spouse stays home to take care of their three children. You know, their credit would go up by more than $1,200. That can help them buy food, clothes, school materials for their children.

KELLY: Having looked at your analysis. It sounds like there is room, in your view, for a bigger tax credit, that Congress could do more. But this is still quite a meaningful change.

COX: That's right. And we saw in 2022 child poverty go up significantly.

KELLY: Because the pandemic-era credit expired?

COX: Because of the expiration of the expanded credit as well as other pandemic relief. What we have before us is a bipartisan proposal that is one of the best opportunities to lift as many as 400,000 children above the poverty line this year. And, again, 16 million children across the country would see their credit go up under this proposal.

KELLY: Kris Cox of the Center on Budget and Policy Priorities. Thanks so much.

COX: Thank you. Transcript provided by NPR, Copyright NPR.

NPR transcripts are created on a rush deadline by an NPR contractor. This text may not be in its final form and may be updated or revised in the future. Accuracy and availability may vary. The authoritative record of NPR’s programming is the audio record.

Mary Louise Kelly is a co-host of All Things Considered, NPR's award-winning afternoon newsmagazine.
Lauren Hodges is an associate producer for All Things Considered. She joined the show in 2018 after seven years in the NPR newsroom as a producer and editor. She doesn't mind that you used her pens, she just likes them a certain way and asks that you put them back the way you found them, thanks. Despite years working on interviews with notable politicians, public figures, and celebrities for NPR, Hodges completely lost her cool when she heard RuPaul's voice and was told to sit quietly in a corner during the rest of the interview. She promises to do better next time.