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August 30, 2024
Vice President Kamala Harris recently announced an economic plan for her presidential campaign. A centerpiece is the transformation of the Child Tax Credit (CTC) into a child allowance. If it became reality, the policy would discourage parental employment and risk harming the long-run prospects of children. These unintended consequences together with the plan’s cost should…
August 24, 2024
A centerpiece of Vice President Harris’ newly released economic plan is a revamped Child Tax Credit, which would send families $6,000 for each newborn and up to $3,600 for older children, up from the existing $2,000 per child credit. Her proposal follows Vice Presidential candidate J.D. Vance’s recent call to increase the credit to $5,000…
April 9, 2024
The Child Tax Credit is a tax benefit available to many American families for the purpose of reducing their federal income tax liability. It’s specifically designed to help offset the cost of raising children. The CTC of today, however, differs starkly from its pre-pandemic structure. Many economists, including Kevin Corinth, think that the post-pandemic changes were a step…
April 8, 2024
When Americans file their taxes in the coming weeks, one group will be singled out for a tax hike: middle-class families with children. This April, a family with three children making at least $42,000 will pay about $950 more in (inflation-adjusted) federal income taxes than they paid in 2018 — when the Tax Cuts and Jobs…
March 28, 2024
Abstract The Tax Relief for American Families and Workers Act of 2024, which the US House of Representatives passed on January 31, 2024, and the Senate is now considering, would make important changes to the child tax credit (CTC) if enacted. The legislation would increase CTC payments for families with lower earnings, apply a one-year…
March 4, 2024
The United States Senate is currently debating H.R. 7024, a House-passed bill that would modify the Child Tax Credit (CTC) in several ways. One of the most consequential changes would increase the rate at which the refundable portion of the credit phases in, from the current 15% rate applied to all families to 15% times…
February 27, 2024
H.R. 7024, the Tax Relief for American Families and Workers Act of 2024, passed the House on January 31, 2024 and now faces an uncertain fate in the Senate. The bill is intended to offer something for both Republicans and Democrats—business tax cuts and an expansion of the Child Tax Credit (CTC). But this bargain—which…
February 14, 2024
A new bill is making its way through Congress, aiming to expand the existing Child Tax Credit (CTC) policy. As part of a Dispatch debate series, associate editor Luis Parrales moderates a debate between Kevin Corinth of the American Enterprise Institute and Patrick T. Brown of the Ethics and Public Policy Center on the merits of the proposal. What are the tradeoffs of a work requirement? Should…
January 29, 2024
The Wyden-Smith proposed tax legislation would make four changes to the Child Tax Credit (CTC). First, it would increase the cap on the refundable portion of the CTC, eventually to the same amount as the maximum non-refundable CTC. Second, it would begin indexing the maximum non-refundable CTC with inflation. Third, it would apply a one-year lookback for…
January 29, 2024
A renewed effort to expand the child tax credit (CTC) is currently making its way through Congress. The proposed policy would increase benefits for low-income families—especially those with multiple children—automatically grow the credit with inflation, and most contentiously, eliminate the work requirement for families who had earnings in the prior year. In debating these changes and even…