The Child Tax Credit (CTC) has offered significant financial relief for many families across the United States. While the federal government, through the IRS, provides substantial support, several states have taken additional steps to offer more aid to families. In 2024, up to 16 states are participating in sending out additional child tax credit payments, with some states offering up to $7,000 in total benefits when combined with federal support.
Federal Child Tax Credit overview
The federal Child Tax Credit is designed to help families with the costs of raising children. For the tax year 2024, eligible families can receive up to $2,000 per qualifying child under the age of 17. This credit is partially refundable, meaning that even if a family owes less in taxes than the credit amount, they can still receive a portion of the credit as a refund.
States offering additional Child Tax Credits
In addition to the federal CTC, several states have introduced their own child tax credit programs to further support families. These state-level credits vary in amount and eligibility criteria, providing additional financial relief to those who qualify.
California
California offers a Young Child Tax Credit (YCTC) for families earning less than $25,000 annually. Eligible families can receive up to $1,000 per child under the age of six. Families earning between $25,000 and $30,000 receive a reduced credit.
Minnesota
Minnesota provides a substantial child tax credit, offering up to $1,750 per qualifying child. The credit begins to phase out for single filers with incomes above $29,500 and for joint filers with incomes above $35,000. This initiative is expected to benefit approximately 300,000 residents.
Colorado
In Colorado, families with incomes of $75,000 or less ($85,000 for married taxpayers filing jointly) can receive up to $1,200 per qualifying child under the age of six. This credit is designed to support lower and middle-income families.
New Jersey
New Jersey’s Child Tax Credit Program offers a refundable $500 tax credit for each child under six years old for families with incomes of $30,000 or less. Households earning up to $80,000 can qualify for a reduced credit of $300 per child.
Vermont
Households with an income less than $125,000 are eligible for $1,000 per child under the age of five.
Oklahoma
Households with an income less than $100,000 are eligible to get 5% of the federal child tax credit.
Oregon
Families with an income less than $30,000 are eligible to get $1,000 for each child under age five.
New York
Eligible families can either claim 33% of the federal child tax credit and federal additional child tax credit for qualifying children or $100 for each qualifying child. The state has expanded its credit to include children under age four.
Utah
Eligible households can receive $1,000 per child between the ages of one and four years old. The amount decreases by $10 or every $1 in income that exceeds a certain income threshold.
Wisconsin
Eamilies can now get between $2,000 and $3,500 for one qualifying dependent, and between $4,000 and $7,000 for two or more qualifying dependents.
Other states
Other states participating in offering additional child tax credits include Arizona, Idaho, Maine, Maryland, Massachusetts and New Mexico. Each state has its own set of eligibility requirements and credit amounts, tailored to support families within their jurisdictions.
Impact of state-level Child Tax Credits
The introduction of state-level child tax credits has had a significant impact on reducing child poverty and supporting family financial stability. These credits provide essential funds that can be used for childcare, education, healthcare, and other critical needs. By supplementing the federal CTC, states are helping to ensure that more families can meet their children’s needs and improve their overall quality of life.
Future prospects
Looking ahead, there is ongoing discussion at the federal level about expanding the Child Tax Credit. Proposals include increasing the maximum refundable amount and making the credit fully refundable, which would provide even greater support to low-income families. If these changes are implemented, combined with state-level credits, families could see even more substantial financial relief in the coming years.
The combination of federal and state child tax credits represents a robust effort to support families across the United States. With up to 16 states offering additional payments, families can receive significant financial aid, potentially totaling up to $7,000 when combined with federal benefits. These initiatives play a crucial role in reducing financial stress for families and ensuring that children have the resources they need to thrive.
