Congress is considering an expansion of the Child Tax Credit (CTC) that could significantly benefit low-income families and children. The proposed expansion is part of a larger tax bill that aims to increase access to the CTC for lower-earning families. While the proposed expansion of the CTC is smaller than the 2021 expansion, it is expected to have a significant impact on low-income families and children. The ERLC joined a letter with other pro-life partners expressing our support for the CTC deal that has come together.
The proposal is part of a larger bipartisan, compromise tax package that also includes tax benefits for businesses. The package passed the House of Representatives Ways and Means committee with a vote of 40-3 and is expected to receive a vote on the House floor in the coming days. The expansion of the CTC is part of a broader conversation about the role of tax credits in supporting low-income families and reducing child poverty.
Here is what you should know about the proposed legislation:
What is the current Child Tax Credit?
The current child tax credit provides a nonrefundable credit of $2,000 per child under age 17 for families earning up to $200,000 ($400,000 if filing jointly). There’s also an additional child tax credit, which is meant to help families with insufficient tax liability to claim $2,000 per eligible child. The refundable amount is currently capped at 15% of the family’s income above $2,500.
What are the proposed changes to the Child Tax Credit?
The proposed expansion would change the way the CTC is calculated by allowing families to multiply the credit by the number of children they have. For instance, a family that makes $13,000 a year with two children would receive $1,575 per child, instead of $1,575 overall.
The proposal also includes an increase in the refundability cap, or the maximum child tax credit families can earn per child, to adjust for inflation. The cap was previously $1,600 and would increase to $1,800 in 2023, $1,900 in 2024, and so forth.
What would be the impact of this expansion of the Child Tax Credit?
The proposed expansion is expected to benefit about 16 million children in low-income families. The Center on Budget and Policy Priorities estimates that the expansion could lift as many as 400,000 children above the poverty line.
The expansion would be particularly beneficial for families with multiple children. Under current regulations, families with multiple children earn the same child tax credit as others with the same salary but fewer children. The proposed changes would allow these families to receive a larger amount of the credit.
The CTC was previously expanded in 2021 as part of the American Rescue Plan. This expansion increased the CTC to a maximum of $3,600 per child, increased the age limit, and made it fully refundable, with half the sum available in advance monthly payments. However, these changes were only for that tax year. The 2021 expansion contributed to a record low child poverty rate and helped reduce food insufficiency and increase families’ ability to meet their basic needs.
Why do some Christians support this expansion?
Christians can disagree about whether direct payments from the government is the most prudent way to spend taxpayer dollars. Yet the proven benefits of this program have led many believers to champion it as an effective means of reducing child poverty and providing more support to low-income families.
Additionally, while the proposed CTC expansion provides financial assistance to families, it also encourages self-sufficiency by helping families cover the costs of raising children and potentially enabling parents to invest in education or job training. This aligns well with an emphasis, shared by many Southern Baptists, on the importance of work and personal responsibility for promoting flourishing and dignity.
Just as the tax code—not often a place where Christians think of advancing pro-life policy—confers benefits to marriage because of the recognition of its societal good, the aim of these payments to alleviate child poverty is one way to recognize children as a social good. Particularly in a post-Roe environment, we are eager to support vulnerable mothers and families who might be considering abortion due to their financial situation and help them choose life.
Even if we would prefer another method or our political preference advocates a different way, a society that begins to have a greater appreciation for children and advances the protection of the vulnerable is clearly something pro-life Christians should appreciate.