If one thing has been consistent about the Obama Administration – it is the failure of its economic policies. The President’s economic policies make it harder for American families to get by every day: A record number of Americans are unable to work, and those who can find work are unable to secure full-time work and instead are forced to accept only part-time jobs. This last quarter the economy actually shrunk, and real wages – what Americans use to pay their mortgages and put their kids through school – are continuing to fall.
Worse yet, the cost of raising a family is only getting more expensive. The price of clothing, food, child care and schooling all continue to climb. According to the Department of Agriculture, since 1960, the cost of raising a child has increased by about 4.4 percent per year. Currently, our tax code helps ease some of this burden by providing a Child Tax Credit. The credit, which has been around since the 1990’s, now provides a $1,000 tax credit for each child. Unfortunately, that credit is not, and has not been, indexed for inflation. So, while the cost of raising children continues to rise, the value of the Child Tax Credit actually decreases.
Today’s legislation, H.R. 4935, the Child Tax Credit Improvement Act of 2014, will fix this problem by indexing the Child Tax Credit for inflation. Making a commonsense change like this will ensure that families can make every dollar count. The current Child Tax Credit also disadvantages those who file jointly compared to those who file as single individuals, creating what is known as the marriage penalty. This bill would eliminate the marriage penalty embedded in the child credit, helping millions of families across the country.
The Family Research Council, which supports this bill, notes the importance of the child credit: “This tax credit recognizes the important contribution of the family and children to our country and starts to address a problem with our tax code today, the marriage penalty. A fair system of taxation does not penalize marriage and family.”
In addition, this bill contains strong anti-fraud provisions to ensure that the Child Tax Credit goes to those who are truly deserving. The bill would require one parent to submit a Social Security Number to qualify for the refundable portion of the Child Tax Credit. According to a report by the Treasury Inspector General for Tax Administration, the number of filers for the Additional Child Tax Credit without a Social Security Number grew from 62,000 filers (claiming $62 million in benefits) in 2000 to 2.3 million filers (claiming $4.2 billion in benefits) in 2010. This is a commonsense provision that will help safeguard taxpayer dollars from fraud, and put it in line with other refundable tax credits, like the Earned Income Tax Credit, which require a Social Security Number.
I hear too many stories about families struggling to afford basic necessities to care for their children. It is time we make some simple improvements to the Child Tax Credit, so it keeps up with the cost of raising children.
Improving the Child Tax Credit would give moms and dads nationwide needed relief at a time when their budgets are tight and they are forced to make difficult choices about how to spend their money. This provision has earned bipartisan support for years, so let’s vote yes on this opportunity to help American families.