Reducing Child Poverty Through the Child Tax Credit
The Institute on Taxation and Economic Policy at Columbia University released a report examining the effect of expanded state Child Tax Credits (CTCs) on reducing child poverty. The CTC helps working families offset the cost of raising children by subtracting up to $2,000 per child from what parents owe in federal income tax. However, approximately one-third of low-income families cannot claim the full federal credit because of its lack of refundability and earnings requirements. The report’s 50-state analysis finds that expanding the CTC at the state level could lift up to 4.5 million children out of poverty.