The child tax credit has become a focal point in the upcoming U.S. elections. During the recent presidential debate, Democratic candidate Kamala Harris introduced her proposal to grant $6,000 to families with newborns, stressing the need for greater support for parents during the first year of a child’s life. Harris highlighted that this initiative is aimed at easing the financial burden families face during a critical time in a child’s development.
In the debate, Harris emphasized the importance of providing more support to young families, and her plan involves expanding the child tax credit to $6,000 for parents with children under one year of age. This proposal would extend the current program, which offers $2,000 per dependent child under 17. Harris’ plan would significantly increase the financial aid for parents with newborns, offering them considerable relief during a key stage of their child’s growth.
An expanded child tax credit: Kamala Harris’ proposal
While this plan is not entirely new, the idea of expanding the child tax credit has been a topic of discussion among Democrats, particularly following the implementation of the American Rescue Plan in 2021. This temporary measure increased the child tax credit to $3,600 for children under six and $3,000 for those aged six to 17.
Although that expansion was temporary, it had a notable impact on reducing child poverty, something Harris aims to replicate with her new proposal.
How the new child tax credit would work
Currently, the child tax credit allows parents to receive up to $2,000 per dependent child, with $1,600 of that amount being refundable. This means that even if parents have little or no tax liability, they can still receive that amount as a refund. The remaining $400 can only be applied to reducing the amount of taxes owed.
Harris’ plan aims to go further, offering $6,000 during the baby’s first year. This amount is intended to cover some of the major expenses families face during the early months, such as diapers, food, medical care, and other essentials. Similar to the 2021 expansion, Harris’ proposal would also eliminate income and work requirements, allowing eligible families to receive the full credit, regardless of their financial situation.
Why is this proposal important?
The first year of a child’s life is one of the most expensive periods for parents. Families often face medical costs, the need to buy baby essentials, and, in many cases, a reduction in income if one parent takes time off to care for the newborn. Harris’ proposal to increase the child tax credit to $6,000 aims to ease some of this financial strain, allowing families to focus more on the care and well-being of their children without the added worry of financial hardship.
Additionally, the expansion of the child tax credit has the potential to significantly reduce child poverty rates, as seen with the temporary increase in 2021. According to Columbia University’s Center on Poverty and Social Policy, the 2021 expansion reduced monthly child poverty rates by nearly 30%. If Harris’ proposal is implemented, it could replicate this success, helping millions of children grow up in more financially stable environments.
Comparison with Republican proposals
While expanding the child tax credit has been a key issue for Democrats, some Republicans have also shown interest in increasing the credit. Former President Donald Trump, for instance, has hinted during his campaign that he might consider a “significant expansion” of the child tax credit, though he has not provided any specific details about what his plan would entail.
Meanwhile, Senator J.D. Vance, Trump’s running mate on the Republican ticket, mentioned in an interview that he would like to see a child tax credit as high as $5,000 per child. However, both Vance and Trump acknowledge that any expansion of the child tax credit would depend on negotiations with Congress and the economic feasibility of such a proposal.
How would the expanded child tax credit be funded?
One of the primary questions surrounding Harris’ proposal is how it would be funded. Harris has floated the idea of raising taxes on large corporations and high-income individuals to pay for her economic plan, which includes the expanded child tax credit and other family support measures. However, the specifics of these tax increases have yet to be detailed, leaving some uncertainty about how the plan would be fully financed.
The Committee for a Responsible Federal Budget has noted that while expanding the child tax credit is a positive idea, the necessary tax increases to fund it need to be clear and sustainable in the long term. Despite these concerns, Harris continues to advocate that her plan would have a positive impact on working families and would contribute to reducing child poverty.