Expanding Child Tax Credit Could Lead to Major Reduction in Child Poverty
March 17, 2016Print
By Kate Skochdopole
An expanded Child Tax Credit (CTC) could drastically reduce the number of children living in poverty, according to a new report from The Century Foundation.
Doing More for Our Children, which was released by the Bernard L. Schwartz Rediscovering Government Foundation and authored by experts at Columbia University, shows how the child poverty rate would be effected by specific changes to the CTC, such as a different phase-in mechanism and an increase in benefits for young children. Researchers found that while the current CTC already lifts 1.7 million children out of poverty each year, increasing the annual maximum benefit from $2,500 to $4,000 and making the phase-in more generous would help an additional 3.2 million kids move out of poverty annually.
The Columbia University researchers also examined the effects of a Universal Child Allowance program, a taxable benefit to each family with children regardless of income level or employment. Their models indicated that a $2,500 allowance to each child would lift 5.5 million children out of poverty and bring the child poverty rate down to 11.5 percent.
The full report is available here.