On January 31, the House of Representatives passed a tax package that includes an expansion of the child tax credit that would benefit 16 million children in low-income families in its first year. That number’s been shared a lot when talking about this policy, but there are real people behind the data point whose lives would be fundamentally changed if this tax bill passes in the Senate.
Past expansions of the child tax credit were wildly successful. In 2021, thanks to grassroots organizing, the Biden Administration implemented an expanded child tax credit as part of the American Rescue Plan. This credit not only put more money in families’ pockets, but showed up monthly in the pockets of the families who needed it most. And it slashed child poverty in the United States.
The program has since reverted back to its status quo, providing less funds to parents and excluding folks who need it the most. But if they act quickly, the Senate still has the opportunity to take a step in the right direction with the Tax Relief for American Families and Workers Act and get boosted checks to more families this tax season.
If they pull it off, real families across America already have plans for how they would spend funds to keep them afloat and save for the future.
It’ll help alleviate the pressure of inflation
Trisha is a single mom to four children living in Sioux City, Iowa. When she received the expanded child tax credit in 2021, she found that it gave her family breathing room to build out their emergency fund, purchase school supplies, and budget their money more responsibly.
Trisha is now working toward providing a forever home for her children by renting to own — but that means she is responsible for home maintenance and emergency repairs when they arise. Just recently, her water pipes froze and the water line backed up, but Trisha didn’t have the cash on hand to pay for the necessary fixes.
Despite her hard work to bring her family economic security, she still finds that situations out of her control can be financially devastating. She is one emergency or accident away from not being able to pay her bills.
That’s why she’s looking to this latest expansion in the tax package to help keep her family afloat, no matter what comes their way. She wants to make sure her kids are safe, have a home, have food to eat, and have the basic necessities they need to thrive. And it’s not just her kids that would be impacted, but her community as a whole.
“My local economy is feeling the pressure of inflation right now. The child tax credit has the potential to empower people to spend where they live and revive small businesses. When we invest in families, everyone thrives,” she said.
It could bridge the gap to financial security
Lisa lives in New Jersey with her 16-year-old son and works as an on-call hospice nurse at night so she can stay home with him during the day. He has severe depression and requires extra care and supervision because of his condition.
When she received the 2021 child tax credit, she used it to pay off utility bills that had piled up. If she received more from an expanded child tax credit, she plans to use the money to help purchase groceries, which have been harder to afford with rising costs.
“I had to take a pay cut to take care of my son, which is absolutely necessary,” she said. “But I’m still way past income limits for assistance and find myself truly in the gap between having a safety net and feeling financially secure.”
Larger families will get the help they need
Caressa and her husband live with their blended family in American Fork, Utah. Jason has four children from his previous marriage, Caressa has two children from her previous marriage, and they share six six-year-old twins who are on the autism spectrum.
Caressa worked for over 20 years as both an educator and a manager in child care. She left her last role as a director of a corporate-owned center to pursue opening her own center, where she envisioned specializing in services for children with special needs. But as debt piled up and barriers to starting her own business arose, Caressa had to put her dream on hold to prioritize her family. And the child tax credit helped her to navigate that.
Having children with special needs raises household expenses in unexpected ways, from having to buy specialized sensory-friendly clothing to paying for necessary additional medical appointments and therapies.
When her family received the expanded credit in 2021, they were able to put the money toward paying down some debt, purchasing food and clothing for their children, and paying for the bills acquired by having children with special needs.
Caressa remembers crying and feeling an overwhelming sense of gratitude upon receiving the money. “Right now, raising a large family is a financial struggle. Each of our children have their own special needs, not just our children with ASD.”
Looking to the new expanded tax credit, Caressa hopes to use the funds to help address their rising rent costs. Housing is a double-edged sword for the family, as they cannot afford the rent for their current home, but also cannot afford costs associated with moving like deposits, first-months rent, and more. And Caressa cannot start her business until she can afford to buy her own home or rent a commercial leasing space. And because she and her husband had to sell their second vehicle to pay for rent and groceries, it’s become more difficult to get her family to work, school, and appointments.
When considering if Utah was indeed the most family-friendly state, she said, “People in Utah are kind – but kindness doesn’t pay bills or provide after school programs, respite care, preschool, livable wages or affordable housing.”
We could save for our children’s futures
When Rhiannon first received the expanded child tax credit back in 2021, it could not have come at a better time. She was pregnant with her second child, finishing up graduate school, renting a two-bedroom apartment, and making $11 an hour as an intern therapist at a prison.
Her husband was making fine money, but the costs of daycare and rent while she looked to enter the workforce with a new baby made it hard to breathe. The tax credit was a relief to their family as Rhiannon knew it would cover what they needed to keep going.
Now, Rhiannon and her husband are dealing with the rising costs of everyday life. They recently bought a home in Holladay, Utah, which landed them a $4,000 mortgage, and are paying around $2,100 a month for child care. Her monthly salary breaks even with the cost of child care for the family, but it is important to Rhiannon to continue growing her career and to access benefits like medical insurance for her family.
If they received a boost in the child tax credit, they’d put it toward hiring more child care – she and her husband both work flexible hours to alternate taking care of their children, but that means later and earlier hours and a worse quality of life for the family as a whole. She also wants to start saving for her kids’ college funds, something they haven’t been able to do yet.
“I feel like one of the lucky ones — we’re able to make it work, we both have good-paying jobs and help with our kids. But we’re still barely scraping by. If our family can feel this financially strained, how are families with fewer resources keeping their heads above water?” said Rhiannon.
It could help keep our family healthy
Kiaya and Jason Carter live in Cincinnati, Ohio, where they’re raising their three-year-old, Lola. They both work full-time as contractors and depend on child care to be able to perform their jobs.
When they received the expanded child tax credit in 2021, they put everything they received toward child care. That $200 dollars a month was the cost of just one week of care for Lola. Around that time, Jason lost his job. Being able to supplement their income with the tax credit and keep Lola in care was essential for the economic survival of their family.
Despite Lola getting older and switching from home-based care to a center, the Carters’ childcare costs have only decreased by a whopping $2. Kiaya’s first paycheck each month goes directly to paying for child care and she has to schedule her work around making payments toward their bill. Because they have to invest every spare dollar they have into child care, the possibility of an expanded child tax credit is a beacon of hope for the family.
“This issue doesn’t just impact whether or not we can afford child care — it affects our quality of life as a family. Things like gym memberships so we can take care of our physical well being, or putting Lola in activities like gymnastics could be financially impossible. It’s even impacting family planning because we want another child, but aren’t sure how we can afford it,” she said.
It could restore our faith in our leaders
Latoya is a working mom who lives with her four children in Florida. As Latoya has grown in her career and started making more money, she’s found that increasing your salary isn’t always beneficial financially – especially as costs rise and many people making just barely paid a living wage are priced out of government services that could help lift them to the middle class.
Latoya’s family was struggling to buy groceries when she received the 2021 expanded child tax credit. They didn’t qualify for food assistance, but she still had four mouths to feed and food costs were shooting up. Her family used the extra money they received to feed themselves, as well as to stock up on school supplies, pay off utility bills, and get some new clothes for the kids.
Latoya is hopeful an expanded child tax credit will apply to her. She’d like to use the money to pay off her car, which she relies on to get to work and to get her kids to school and their activities. The rest would go fully toward groceries, gas, or utilities. The extra money in her pocket would give her a sense of peace and ease some of the financial stress she’s under.
“Rising costs of living have hit my family hard and I’m struggling to make my mortgage payments and to give my kids everything they need, even though I make a decent income,” Latoya said. “I feel like my representatives don’t care about families or the challenges we’re facing to keep our heads above water.”
Our leaders in the Senate now have the opportunity to show they do care about families like ours, keep children from going hungry, ease stress on families, and boost our economy by passing this expanded child tax credit.
Poverty is a policy choice that stories like these prove we don’t have to keep making. As we face another year of climbing costs for groceries, gas, rent, child care, and other life necessities, we can be a part of the solution forward instead of turning our backs on our nation’s children and families.
It’s time for Congress to close this deal and get us closer to the expanded child tax credit we deserve.