Illinois lawmakers should pass a state child tax credit



That’s the number of Illinois children who fell back into poverty after the monthly federal child tax credit payments ended in December, according to one estimate. Another estimate put the number at 150,000. Nationally, 3.7 million children are in families that have lost these payments of $250 to $300 per month depending on the age of the child.

“Giving families an extra boost every month works,” as Joanna A. Ain, associate director of policy for Washington, DC-based Prosperity Now, told us. His group and others have pushed Congress to resurrect the monthly payments and make them permanent, a move we support. They don’t expect Congress to act anytime soon, and neither do we.

This vital lifeline for some of the nation’s most needy people is unlikely to be restored, as it is tied to President Joe Biden’s massive Build Back Better initiative, which is all but dead.

There is something state legislators can do, however: enact a child tax credit. It was a key part of Governor JB Pritzker’s platform when he was running for governor and later when he unsuccessfully tried to get the income tax referendum on the ballot. vote.

While what’s on offer in Springfield isn’t as generous as what families were getting federally, a $600 child tax credit would help those in need at a time when inflation is dramatically squeezing budgets. Household. Low-wage workers typically spend, rather than save, any increase in income, so not only would this help struggling Illinois families, but it would also spur private sector economic growth.

Dozens of lawmakers have signed legislation in the Illinois Senate (SB3774) and House (HB4920), which would create a dependent child tax credit and expand the earned income tax credit. There is ample evidence that the federal “refundable” earned income tax credit has become one of the most effective anti-poverty programs in the country.

Help families pay for essentials

A state child tax credit would help Chicagoan Susana and her family. The extra $500 a month she and her husband received as federal child tax credit payments continued to trickle in helped them pay for basic expenses, including utility bills and shopping bags. back for her two children from middle school and high school.

Some of the money also went to ComEd after the family received a disconnection notice. “We weren’t able to repay all the debt, but we were able to pay a lot of it,” she said through an interpreter.

The family was “really stressed economically” when COVID first hit because Susana’s husband lost his job at the factory, and that stress has not diminished. Her husband got a job in a restaurant, but he only works 32 to 35 hours a week, which is far from enough to pay all the bills.

“A lot of families are still living hand to mouth,” said Susana, who works for a group that helps low-income families. “We and many families still have a debt from last year that we are still paying.”

She said the current narrative in the media is that jobs are plentiful and employers can’t find enough workers to cover shifts, but that hasn’t been her family’s experience. Another common misperception is that the working poor will not spend government assistance like this appropriately.

A boost to the economy

Research shows that recipients of the federal child tax credit spent the money immediately on day-to-day expenses, boosting the economy as a whole, helping small businesses stay afloat, and bringing in an additional sales tax that helps to fund the government.

“People want to be able to work, they want to be able to get to work, they want to be able to do their jobs,” Ain said.

A state child tax credit would provide essential assistance to Illinois residents who simply want to do their jobs, helping them get to work, pay for daycare, get groceries and cover rising housing and utility costs.

If the General Assembly passes the bills as currently written, 4.8 million people in Illinois, including 1.9 million children, would benefit, according to Ralph M. Martire, executive director of the Center for Tax and Budget Accountability.

Once fully implemented, the $415 million annual cost of the legislation would be far less than the $1 billion economic benefit, Matire said. “That’s a pretty high return on investment” for people who have been heavily impacted by the pandemic, he added.

State lawmakers, before adjourning this spring, should pass this legislation — and help those 138,000 Illinois children and their families stay out of poverty.

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