The stagnation and lack of change in the childhood poverty rate calls for policy makers to do something dramatic and innovative about it. We are excited that the American Rescue Plan included enhancement to the Child Tax Credit to specifically to address childhood poverty with the goal in mind that the increase in cash assistance to families may be able to cut childhood poverty in half.

The enhancements to Child Tax Credit include:

• Increasing the credit amount to $3,600 for kids under 6 and $3,000 for kids over 6;
• Making the credit refundable and paid directly to families;
• Offering the credit as an advance payment to families July-December, or a monthly allowance, that will be deposited directly into families’ linked bank accounts;

The Center on Budget and Policy Priorities estimates that 86% of children, 1.6 million, will benefit from the enhanced child tax credit in Virginia. And 249,000 kids will be lifted above or closer to the poverty line by the expansion.

For more info and to access the online tools to update status or file to receive the credit if your family did not have a tax liability, visit ChildTaxCredit.gov.

Access and download the PDFs below for more information (courtesy of the White House and Annie E. Casey Foundation) by clicking on the thumbnails.

How policymakers can act to help families experiencing financial hardship and maximize the Child Tax Credit.

1. During the August Special Session, state lawmakers can dedicate American Rescue Plan resources to improve tax filing outreach and preparation services to ensure non-filers and families with infants receive the credit.
2. Virginia lawmakers can also provide state level enhancements to the federal tax credits including a refundable Earned Income Tax Credit (EITC) and a state-level child tax credit.
3. Congress can act to make the Child Tax Credit permanent adopting the proposal included in President Biden’s American Families Plan.

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