Failure to extend improvements in Child Tax Credit would harm millions nationwide
WASHINGTON (Feb. 17, 2009) - If Congress fails to extend 2009 improvements to the tax code for working families, millions of American children - including perhaps 600,000 in North Carolina - will be harmed, a new report by the Center on Budget & Policy Priorities finds.
The American Recovery and Reinvestment Act of 2009 (ARRA) expanded the child tax credit to reach many low-income working families who previously were excluded from it and boosted the credit for many more such families who were receiving only a fraction of the full credit.
"These tax credits helped hundreds of thousands of working families in North Carolina and their children," said Meg Gray Wiehe, a public policy analyst with the North Carolina Justice Center's Budget & Tax Center. "Targeting low- and moderate-income families in this way is an effective means to keep families with children from slipping into poverty."
The report estimates that 578,000 children in North Carolina are assisted by the tax credits. The margin of error is plus- or minus-58,000 children, meaning the number could be over 600,000. These children of working families are among North Carolina's most economically vulnerable.
President Obama's fiscal year 2011 budget, as well as legislation that Senate Finance Committee chairman Max Baucus introduced last year, would make this change permanent along with the child-tax-credit expansion that Congress enacted in 2001 and many other tax cuts it enacted in 2001 and 2003.
"If Congress fails to extend the 2009 improvements, most likely as part of expected legislation to make the so-called 'middle class tax cuts' permanent, millions of low-income working families with children will lose much or all of their child tax credit, and many will fall into - or deeper into - poverty," write the report's authors.
Nationwide, the report estimates that 4 million children who already are poor will fall deeper into poverty if Congress does not extend the 2009 child tax credit improvements. Further, 600,000 children will fall into poverty as the loss of some or all of the credit pushes their families' incomes below the poverty line.
FOR MORE INFORMATION, CONTACT: Meg Gray Wiehe, 919.856.3192; Jeff Shaw, Director of Communications, 919.836.2402