Stimulus Update: Child Tax Credit Payments Are Alive and Well in These 11 States

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  • States are stepping up to fill the gap left by advance Child Tax Credit payments.
  • Most states have opted to offer assistance through tax credits.

When it comes to raising children, every little bit helps.

Nationwide, 16.7% of children live in poverty. Three million of those kids (approximately 25%) were lifted out of poverty in 2021 by President Joe Biden's American Rescue Plan. The plan expanded the Child Tax Credit and allowed families to receive the front half of those credits through monthly payments. Although President Biden wanted to extend the expanded Child Tax Credit through 2025, partisan bickering in Congress put a stop to it.

In May, five months after the last Child Tax Credit was deposited into bank accounts, a survey by ParentsTogether Action, a parent advocacy group, found that families are struggling once again to feed their children. Nine out of 10 parents surveyed said they're having trouble making ends meet, with 45% saying they've skipped meals so their children can eat.

State governments have stepped into the void created by Congress. Here are 11 states helping to provide for families.

1. Alabama

Alabama legislators were nearly unanimous in their vote to give families who received the Child Tax Credit a break on their taxes. It is estimated that the average family with two children saved $200 at tax time.

2. California

Through a program called the "Young Child Tax Credit" California is offering $1,000 to qualifying families with annual earnings under $25,000. Families earning between $25,000 and $30,000 will receive a reduced credit. This tax credit is available for children under the age of 6 to families who qualify for the California Earned Income Tax Credit.

3. Colorado

Colorado is also offering a child tax credit to families with children under the age of 6. Beginning in January 2023, families can claim 5% to 30% of the federal Child Tax Credit for each qualifying child. This tax credit will be available to single Colorado residents earning $75,000 or less, and married couples earning $85,000 or less. Children must be 6 or younger on Dec. 31, 2022 to qualify.

4. Idaho

Families in Idaho can expect a child tax credit of $205 per qualifying child when they file their next tax returns. In addition, the state lowered the individual income tax rate by 0.475%, with the top rate for individuals now at 6.925%.

5. New Mexico

New Mexico has more than one plan in the works. The first is a child income tax credit of $75 to $175 per qualifying child. The next is a Child and Dependent Care Tax Credit (CDCTC), which amounts to 40% of qualifying child and dependent care costs. CDCTC is available to families earning $30,160 or less.

6. New York

Through the Empire State Child Tax Credit, eligible New Yorkers will receive either $100 per qualifying child or 33% of the federal Child Tax Credit and federal additional Child Tax Credit, whichever is greater. The credit is available to married taxpayers filing separately who earn up to $55,000. It is also available to single, head of household, or qualifying widow(er)s earning up to $75,000, and couples filing jointly who earn up to $110,000.

7. Maine

Maine residents are eligible for a $300 tax credit for each qualifying child and dependent.

8. Maryland

Taxpayers earning $6,000 or less with a disabled child under the age of 17 are slated to receive a child tax credit of $500 per child. Plus, through Maryland's Child and Dependent Care Tax Credit (CDCTC), single parents earning up to $50,000 and married couples filing jointly earning up to $75,000 can claim 35% of their federal Child Tax Credit on their state taxes. The credit is reduced for individuals earning up to $110,000 and couples bringing in up to $141,000.

9. Massachusetts

Households in The Bay State with dependents under the age of 12, adults 65 or older, or dependents with a disability will receive a tax credit of $180 for one dependent and $360 for two or more.

10. Oklahoma

Oklahomans who meet eligibility will receive a tax credit of up to 35% of what they spend on childcare for children under 13 or for caring for another dependent who is unable to care for themselves. In addition, a child tax credit equaling 5% of their federal tax credit is available to taxpayers earning up to $100,000.

11. Vermont

In May, Vermont legislators came up with a plan to give families a refundable tax credit of $1,000 per child under the age of 5. Households earning up to $125,000 will be eligible for the entire credit, with the credit dropping by $20 per $1,000 over $125,000.

While direct cash payments may be the best way to help families get on their feet, every little bit helps.

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