By Vincent Hughes and Ashley McBride
The newly expanded monthly child tax credit which was passed into law as part of the American Rescue Plan has helped bring much-needed COVID relief to millions of American families — delivering $300 monthly checks per child to mailboxes across the country.
Now, Congress is debating making that tax credit permanent as part of the reconciliation budget and the President’s Build Back Better Agenda, a move that would further strengthen working families.
Unfortunately, many of the families who need this credit most are not taking advantage of it. Nearly 4 million or more children who are eligible for these payments are not receiving them.
The reason? So-called “tax hesitancy.”
Experts and advocates suggest that some parents, particularly those in low-income communities of color, might be hesitant to go through the process of signing up with the IRS to receive the credit because they think it could backfire and prevent them from receiving other benefits. While most taxpayers receive these credit checks automatically, the lowest-income households have become eligible for the first time, and many of them don’t typically file with the IRS.
These fears are completely unfounded, and often rooted in the work of bad actors’ misinformation campaigns. Families who didn’t file a tax return are eligible for the child tax credit — with no consequence for doing so. The tragedy of this scenario is that misinformation and fear is preventing Pennsylvania’s poorest families from getting relief that is lawfully theirs. These are families who struggle with putting dinner on the table, paying for childcare and health care, and generally making ends meet.
Further, there are practical benefits for the economy that come along with expanding the tax credit and keeping it permanently. Lifting low-income children out of poverty has been shown to benefit the economy and acts as a “fiscal multiplier,” adding to new GDP growth as families spend their credit.
As advocates for underserved communities, the challenge to get more of our families on board with the child tax credit can feel daunting. It is impossible to alleviate mistrust in the government, particularly among communities of color, overnight.
However, we believe that it can start with conversations within our communities — and in other communities that are not taking advantage of this opportunity.
We’re calling on other elected officials and advocacy groups and community organizations to band together and raise awareness about the benefits being left on the table. We need a coordinated effort to enter our communities and have real conversations with those who stand to benefit the most from the tax credit.
Our federal, state and local leaders need to join us in banging the drum about the child tax credit and the myriad other benefits that are potentially becoming available as Congress hammers out what will be two of the most influential spending bills in a generation — the infrastructure deal and the larger reconciliation package. Struggling Pennsylvanians can only make use of the resources they are aware of and trust.
Finally, we strongly encourage that efforts made to educate folks about making sure underprivileged communities get their due include a conversation about the importance of voting. This isn’t about partisanship. It’s about remembering that elections have consequences, no matter what side of the aisle you’re on — and sometimes those consequences include benefits that help level the playing field.
We can’t fix economic inequality with the wave of a wand, but the child tax credit and its potential permanence is a step in the right direction that has and will continue to lift millions of families out of poverty. It’s up to us to make sure that the people who need it most have the tools and knowledge they need to take advantage of it.
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