Governor Kathy Hochul has announced that New York State has started distributing approximately $350 million in supplemental payments to low- and moderate-income families through the Empire State Child Tax Credit program.
According to Hochul’s team, the first round of checks has already been sent out and will soon begin arriving in beneficiaries’ mailboxes. Over the next two weeks, checks will continue to be distributed, and by the end of the month, more than one million eligible families will receive up to $330 per child without needing to apply for it.
How does the child tax credit work?
The Child Tax Credit, known in New York as the Empire State Child Credit, is a refundable tax credit aimed at assisting low- and moderate-income families with children. This credit has recently been expanded to include children under the age of four, benefiting about 600,000 additional families each year.
Benefits of the supplemental payment
These supplemental payments are being issued based on an agreement reached earlier this year between Governor Hochul and the state’s legislative leaders.
The goal is to provide additional financial relief to families already receiving the Empire State Child Credit. The supplemental payments range from 25% to 100% of the tax credit received by the taxpayer in the 2023 fiscal year. Families with lower incomes will receive the highest payments, which can be as much as $330 per child.
Distribution of the payments
The distribution of the checks is happening at a rapid pace, with over 100,000 checks being sent daily. Hochul’s team assures that all eligible families will receive their supplemental payment in a timely manner.
It is important to note that beneficiaries do not need to take any additional steps to receive this one-time payment. It is being automatically provided to those taxpayers who received at least $100 from the Empire State Child Credit on their 2023 state tax returns.
Impact of the child tax credit on family finances
This money arrives at a particularly opportune time, just as many families are preparing for back-to-school shopping. The supplemental payments will help alleviate the additional expenses associated with purchasing school supplies, clothing, and other necessities for the start of the school year.
The primary goal of the Child Tax Credit is to provide significant financial relief to working families. Over the past two years, more than $2.6 billion has been distributed through various supplemental payment and savings programs for New York taxpayers.
These programs include the property tax credit, the supplemental earned income tax credit, the gas tax holiday, and the expansion of the Empire State Child Credit.
In addition to the current payments, Governor Hochul has recently launched a digital portal (ny.gov/childcare) to facilitate access to free or low-cost childcare through the New York State Child Care Assistance Program (CCAP).
This program covers more than 90% of the market rate cost of childcare for most eligible families. Most four-person families pay no more than $15 per week for childcare.
Governor Hochul has worked with the Legislature to reform the childcare system and make historic investments. This includes a commitment of $7 billion over four years to improve the childcare assistance program, expand income eligibility to include more than half of New York’s young children, and increase state reimbursement rates to providers to expand the number of programs available to families.
Future expansions of the child tax credit
In 2025, further adjustments are anticipated in the Child Tax Credit payments due to the first few days of January, February, and March falling on holidays or weekends.
According to the Social Security Administration’s payment schedule, January payments will be made on December 31 of the previous year, February payments a month later, and March payments on February 28. There will be no payments in March.
To manage these changes and maximize the benefits of the Child Tax Credit, it is essential for families to plan their finances ahead of time. Here are some tips:
- Develop a monthly budget: Allocate income in a way that covers all essential expenses without overspending.
- Create an emergency fund: Save a portion of income for unexpected expenses.
- Consult with a financial advisor: Seek professional guidance to manage income and expenses efficiently.
- Stay informed: Regularly review updates on the payment schedule and available benefits.
The Child Tax Credit in New York provides crucial financial support for low- and moderate-income families. With the new supplemental payments, more than one million families will be able to benefit this month.
Properly planning and managing these funds can help ensure greater financial stability and ease economic burdens, especially during key times like the back-to-school season. Stay informed and take full advantage of the available benefits to ensure your family’s financial well-being.
