CHILD POVERTY IS A POLICY CHOICE, BUT ON TAX DAY, PARENTS TAKE CHARGE

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CHILD POVERTY IS A POLICY CHOICE, BUT ON TAX DAY, PARENTS TAKE CHARGE

By Kevin Zwick, CEO

April 15, 2022

The pandemic has made it clear: America is choosing to let its children live in poverty.

For six months last year, the government lifted millions of kids out of poverty through monthly Child Tax Credit checks, a measure that was part of the American Rescue Plan. Despite critics of the plan warning that people would spend the extra income frivolously, parents of young children spent the checks on basic family needs like food, clothing, and rent. For many children, it was the first time in a long time they experienced a pantry filled with food, shoes that fit, or maybe even a new blanket.

But those basics ended abruptly when the Senate failed to pass an extension of the tax credit at the end of last year. Experts warned poverty levels would spike back up and they did. Child poverty jumped up by 41% as soon as the checks stopped coming, according to a recent analysis from Columbia University’s Center on Poverty and Social Policy.

It doesn’t have to be this way.

In my recent OpEd in the San Francisco Chronicle, I outline what parents can do to take advantage of every tax credit available to low-income families, and what leaders in Sacramento can do to reach an estimated 1.7 million children in California who are living in poverty again because we haven’t yet done what we can.

United Way Bay Area is offering free tax preparation services for low- and middle-income residents through our Free Tax Help program through October 15, 2022. California residents who made less than $30,000 in 2021 may be eligible for more than $8,000 in state and federal tax credits, depending on income and family size. Taxpayers who have not filed their 2021 tax returns still have time to utilize these services before the 2022 filing deadline on April 18.

So far this year, our expert, IRS-certified volunteers have completed over 18,000 returns, representing a 24% increase over last year’s tax season. This translates to at least $36 million in refunds back in the pockets of Bay Area taxpayers. In a region where 1 in 3 families earns a paycheck that doesn’t cover basic needs, it is critically important to fight poverty by helping people to maximize their tax refunds.

Poverty hurts – it hurts our families, it hurts the economy, and most importantly it hurts children and keeps them from achieving their potential. We’re encouraged to see Los Angeles Assemblymember Miguel Santiago introduce Assembly Bill 2589, which would backfill the federal Child Tax Credit with a one-time payment from the state. And we’re grateful to the more than 1,000 IRS-certified volunteers helping low-income Bay Area residents to file taxes through United Way Bay Area’s Free Tax Help services right now. Our efforts won’t help all of America’s poorest children. Only the federal government can do that. But we can be the model toward an equitable future.

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