As the 2024 U.S. presidential race moves closer to November 5, both Democrats and Republicans are introducing plans aimed at improving family welfare. A significant issue in this election is the child tax credit, a tool proven to reduce child poverty and provide support to millions of households across the nation. Despite the ideological differences between the two parties, they agree on the importance of this benefit.
The current child tax credit is set at $2,000 per child, providing federal tax relief to roughly 40 million families in the United States each year. However, as economic needs evolve and the cost of living rises, candidates are proposing ways to expand and enhance this credit, making it a central part of their campaigns.
The child tax credit as a central campaign issue
One of the most ambitious proposals regarding the child tax credit comes from current Vice President and Democratic presidential candidate Kamala Harris. Alongside her running mate, Tim Walz, Harris has introduced a plan that seeks to substantially increase the amount of this credit, offering families up to $6,000 for each child during their first year of life and $3,600 annually in subsequent years.
This increase is designed to support families with the high costs that come with a new baby, such as purchasing a car seat, clothing, diapers, and other essentials. Harris has repeatedly emphasized that her proposal is part of a broader strategy to build an “economy of opportunity,” focused on improving the quality of life for working families.
Additionally, Harris has highlighted the achievements of the Biden administration in this area, noting that in 2021, during the height of the pandemic, the child tax credit was temporarily expanded, reducing child poverty by over 50%. According to Harris, this measure demonstrated the effectiveness of the credit as a tool to combat poverty and provide economic stability to millions of households.
The republican stance on the child tax credit
On the Republican side, the proposal also includes an expansion of the child tax credit, though in more moderate terms. Vice-presidential candidate JD Vance has suggested that families receive a credit of $5,000 per child, surpassing the current proposal of former President Donald Trump, who has pledged to keep the credit at $2,000 per child permanently, a figure set during his tenure in the Tax Cuts and Jobs Act of 2017.
While Vance has put forth a higher amount, it remains unclear whether this proposal will be fully adopted by Trump in his electoral platform. What is certain, however, is that without congressional intervention, the child tax credit will revert to $1,000 per child when it expires in December 2025. This presents a challenge for future administrations aiming to maintain or enhance this financial support.
The impact of the child tax credit on American families
The child tax credit has proven to be an effective tool in easing the financial burden on families, especially as the costs associated with raising children continue to rise. A recent report by KPMG revealed that, between 1990 and 2024, the prices of daycare and preschool services in the United States have increased by 263%. Against this backdrop, the child tax credit stands as a key measure to help parents meet these rising expenses.
For many families, the prospect of receiving $6,000 during the first year of their child’s life, as proposed by Kamala Harris, could offer significant financial relief. In addition to covering basic expenses during the early months, this credit could help mitigate the impact of other ongoing costs, such as healthcare, rent, or groceries.
Republicans, on the other hand, view Vance’s proposal as a more measured response to current needs, focusing on providing steady support without imposing excessive government spending. Like the Democrats, they recognize that maintaining this type of assistance is essential for the well-being of families and to promote the country’s economic growth.
The child tax credit and the debate on family expansion
An interesting aspect of the expansion of the child tax credit is its potential influence on family planning decisions. Some critics have suggested that a more generous credit could encourage families to have more children, which, ironically, might conflict with other Democratic policies, such as support for access to abortion.
However, Kamala Harris has argued that both policies can coexist, emphasizing that the child tax credit is not only intended to ease financial pressure but also to ensure that families have the resources needed to raise their children in optimal conditions. For Harris, the true goal is to provide families with the freedom to make informed decisions about their future, without economic factors acting as a barrier.
Harris’s stance highlights the broader debate around how government policies should intersect with personal choices about family size. By offering increased financial support through the child tax credit, she hopes to remove some of the economic burdens that can limit families’ options. In this way, the policy is framed not as a direct incentive for larger families but as a means of giving parents the ability to choose how they want to shape their futures without worrying as much about the financial costs.
For Republicans like JD Vance, the emphasis is more on sustainable support that aligns with conservative principles of fiscal responsibility. Vance’s proposed increase to $5,000 per child is meant to offer meaningful help while avoiding what some in his party see as excessive government intervention in the economy.
This difference in approach reflects the broader philosophical divide between the two parties, though both agree on the need to support families through financial relief.
What specific measures are being proposed to ensure that the expanded child tax credit reaches the intended families?
key measures being proposed to ensure the expanded child tax credit reaches the intended families:
- Increase the refundable portion of the credit:
- From $1,600 to $1,800 in 2023
- To $1,900 in 2024
- To $2,000 in 2025 This will provide more benefits to the lowest income families who don’t owe federal income taxes.
- Allow a steeper phase-in for families with more than one child, so families could reach the maximum benefit per child at around $16,000 in earnings regardless of number of children. This targets more benefits to low-income working families.
- Adjust the $2,000-per-child full credit amount for inflation starting in 2024 to maintain the credit’s value over time.
- Allow families to use either the prior year’s earnings or their earnings for the tax year to claim the credit. This could help families with intermittent earnings access the credit when they otherwise couldn’t.