Letter to the Editor: Much-needed economic relief for Iowa families

To the Editor:

This past month, Iowan families began receiving in-pocket relief thanks to the American Rescue Plan. July 15, the Child Tax Credit program began providing direct payments to families with children 17 and under. If you have children, you might have noticed a direct deposit or check of up to $300 per child from the IRS. If you received this payment, you’re not alone - four out of five Iowans with children qualify.

United States Census Bureau data from 2019 shows that more than 10 million children across the United States live below the federal poverty line, with 11.2% (roughly 357,321 people) of Iowans reporting low incomes. To make matters worse, this is data collected prior to the global pandemic, meaning that these statistics surely underestimate the number of children and families that are battling food insecurity, lost jobs, or the inability to pay for childcare across the state. In data collected by the Center on Budget and Policy Priorities in May-June of this year, 521,000 Iowan households, which is 24% of the state’s population, reported difficulty covering normal household expenses.

The harsh reality of today is that even middle-class families are struggling to make ends meet. The Child Tax Credit program will help families cover basic expenses by providing monthly, direct payments of $250-$300 through December. The remaining tax credit not included in the monthly payments can be claimed on your tax returns in 2022.

Couples who earn less than $150,000/year and single filers who earn less than $112,500/year will qualify for a full tax credit of $3,600 per child under six, and $3,000 for every child between six and 17 years. The Child Tax Credit payments slowly phase down for earners above these levels, tapping out at $400,000/year (couples) and $200,000/year (single). Even if you didn’t earn enough to file taxes this year, you can still qualify for payments by filling out a short form with the IRS.

Data indicates that this program, coupled with other relief from the American Rescue Plan, will cut child poverty in half by 2022. The money is coming to you with no strings attached. It is non-taxable income and comes in time for the start of the new school year. Even better news is these payments will not disqualify any families from programs that they already receive assistance from, such as SNAP, Medicaid, FIP, WIC, or Public Housing, to name a few. If, for any reason, you would prefer to receive your child tax credit in one lump sum during tax season, you can choose to opt out of the monthly payments on the IRS website.

Cindy Axne (D-IA 3rd District) was the lone representative from Iowa to vote in favor of the American Rescue Plan, helping to ensure its passing and guaranteeing almost every Iowan family a monthly Child Tax Credit payment of $250-$300. Investing in today’s youth, who are our future, only makes Iowa stronger.

Anna Berns
Vice-Chair
Winneshiek County
Democrats