NJPP REPORT: How An Expanded Child Tax Credit Would Help More Hard-Working New Jersey Families
REPORT: How An Expanded Child Tax Credit Would Help More Hard-Working New Jersey Families
For Immediate Release
January 31, 2023 – With payments from the inaugural New Jersey Child Tax Credit hitting mailboxes as early as this month, a new report by New Jersey Policy Perspective (NJPP) finds that expanding the program would support more families as they face rising costs, reduce child poverty, and reach hundreds of thousands more children.
The report, How An Expanded Child Tax Credit Would Help More Hard-Working New Jersey Families, analyzes proposed expansions for the new state-level Child Tax Credit: one to include children up to age 12, and another that raises the maximum credit amount from $500 to $1,000 for children under 6 years old. The expanded tax credit would benefit 441,000 families across New Jersey, according to the report, including 713,000 children in households receiving the tax credit. Families would receive an average benefit of $567.
“Providing direct relief to families who need it most is one of the best investments a state can make, and exactly how we make New Jersey the best place in the nation to raise a child,” said Peter Chen, Senior Policy Analyst at NJPP and report author. “Raising the maximum credit will help families with young kids keep up with rising costs, while expanding the age eligibility means more families will benefit. We know that the costs of raising kids do not stop once they turn six years old, and the Child Tax Credit should reflect that reality.“
The expansions analyzed in the report would build on a bipartisan policy with a proven track record of success in directly assisting families struggling with high costs of basic needs. The original Child Tax Credit passed in June 2022 by a 31-6 vote in the Senate and 72-2 vote in the Assembly.
The report notes that programs like the Child Tax Credit have a “multiplier effect” as families often spend the credit immediately and locally, stimulating the broader economy.
“Given the high costs associated with poverty, we all benefit when families have the resources they need to pay for basic necessities like housing, groceries, and child care,” said report author Peter Chen. “What’s best for children and families is what’s best for the broader economy.”
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New Jersey Policy Perspective (NJPP) is a nonpartisan think tank that drives policy change to advance economic, social, and racial justice through evidence-based, independent research, analysis, and advocacy.