Experts Call Bigger Child Tax Credit a Game Changer for Kentucky Families

Congress increased this year's credit, which begins July 15, from $2,000 per child to $3,000-$3,600 per child, depending on age.

click to enlarge As part of the American Rescue Plan Act, Congress increased this year's federal child tax credit. - Photo: badski007, Pixabay
Photo: badski007, Pixabay
As part of the American Rescue Plan Act, Congress increased this year's federal child tax credit.

Starting July 15, nearly 1 million Kentucky kids and their families could get extra income support through the federal child tax credit.

As part of the American Rescue Plan Act, Congress increased this year's credit from $2,000 per child to $3,600 for children younger than 6 years old, and $3,000 for children between 6 and 17 years old.

Dustin Pugel, senior policy analyst with the Kentucky Center for Economic Policy, explained that because the tax credit is not counted as income, folks will continue to be eligible for public-assistance benefits.

He said that to receive the credit, families will need to file a 2020 tax return, even if they don't usually pay federal taxes.

"If you didn't get a stimulus check recently or if you didn't file a tax return anytime recently," said Pugel, "the IRS has created an online portal where folks can go in and put their information and sign up for the tax credit."

Improvements to the tax credit this year could reduce child poverty by 40% nationwide, according to an analysis by the Center on Budget and Policy Priorities. For more information on the Child Tax Credit, Kentuckians can visit childtaxcredit.gov.

Pugel said the credit will make it easier for families in the Commonwealth to afford housing, food and clothing, as well as health care and child care, which research shows makes a huge difference in the well-being of children.

"I think this is a really big deal for Kentucky," said Pugel. "It'll be around - a little over - 90% of Kentucky children that receive this benefit, and it's going to make a huge difference for them and their families."

He added that around 65 million American children will benefit from the new child tax credit including roughly half of all Black and Hispanic children, whose families, along with other families of color, are disproportionately employed in low-income jobs.

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