NORFOLK, Va. — If you have children, you've probably heard of the Child Tax Credit – the tax break you can take if you have qualifying children. Late last month, the House of Representatives passed a bill that could expand that credit. There are hurdles left for the bill in the Senate.
If the bill is enacted, families with low incomes and multiple children could see changes if the Child Tax Credit is expanded.
Many of those families have been working to stay afloat with lifelines provided by various Hampton Roads organizations.
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"More than twice the number of families have come to us with a need [this year compared to last year]," said Matthew Stearn, executive director at Help, Inc. in Hampton.
The last time the child tax credit was expanded during the pandemic some Hampton Roads organizations said they saw a difference.
"People directly used that extra funding to pay for necessities. Right, they didn't take it and spend it on things we would see as frivolous. They really spent it on their rent. They spent it on their groceries because we know that TANF and SNAP don't cover everything," said Jordan Crouthamel, program manager of Virginia Reduction Pilot at ForKids in Chesapeake. "What we saw was a reduction in people who were having to make the tough choice of do I put food on the table or do I pay my rent or can I go to the doctor or can I take my kids to the museum or somewhere that would be enriching for them?"
After that expansion ended, ForKids staff said they saw a spike in the number of families that called their emergency shelter hot line and an increase in mobility where people had to move region to region.
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Crouthamel said that impacted kids as they changed schools more frequently.
"The attendance rate is really dropping for kids who are experiencing poverty," said Crouthamel.
The child tax credit amount a family can receive depends on income.
If the child tax credit is expanded, the maximum amount a family can receive would be multiplied by the number of qualified dependents. If the credit is bigger than the income tax bill, the family can receive some of the remainder as a refund, but not necessarily all. Currently, a family can receive at most $1,600 of the remainder. If the credit is expanded, families could get more.
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By 2025, they could be getting up to $2,000.
The latest bill is also set to benefit the top one percent of earners by offering after-tax income boosts of 0.05%.
If the expansion is approved, the IRS reports you won't need to do anything extra — just file your taxes like normal.
Those in Hampton Roads say no matter what they'll keep working to keep families out of poverty.
"They're the children that your kids sit next to in class," added Crouthamel. "They aren't someone that's over there. They're our kids too."
