Addressing the Child Tax Credit Gap

CPL is working to help connect more California families with the newly refundable federal Child Tax Credit.

Background

In March 2021, Congress passed legislation to provide an additional $3,000 to $3,600 to each child in America through a newly refundable Child Tax Credit (CTC). To receive these credits, eligible families must file taxes. The credit is projected to lift half of Californian children out of poverty: but can only do so if it reaches families in need. Families with incomes around or below the poverty line may not file their taxes because their income level does not require it, and are in danger of not receiving these credits. While the IRS can easily contact families who have filed taxes, it does not have up to date information on children who do not appear on a recent tax return or a way to get in touch with their parents or guardians. State safety-net agencies do interact regularly with low-income non-filing families and have current contact information.

Research Project

To determine which children may be at risk of not receiving the CTC — and help the State of California notify their families of the CTC — CPL is matching and analyzing a list of Californians who appeared in 2018 and 2019 tax returns with a list of Californians enrolled in safety net programs from Jan 2019 through June 2020. This work is an extension of our federal stimulus gap estimates and our estimation of the take-up of the CalEITC. Our analysis will measure differences in receipt and take-up by demographics such as race and ethnicity, geography, language, family size, income and earnings, and immigration status of parents.

Research Team

Matt Unrath (Co-Principal Investigator) Aparna Ramesh (Co-Principal Investigator), Elsa Augustine, Taylor Mackay

Results

Forthcoming

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