Senator Casey Wants Tax Credits More Accessible For Families With Children
Raising a child is expensive, and not surprisingly, that cost has only increased over the past few decades. But tax relief to help families with children hasn’t kept pace with the increased cost.
The average cost of raising a child born in 2013 through age 17 is $245,340, according to the Department of Agriculture. That’s a 23 percent increase from 1960.
U.S. Sen. Bob Casey cited a study from Pew that said weekly expenses for children have increased from $87 in the '80s to $148 in 2013 — a 70 percent increase.
“Also in Pennsylvania, we know that when you look at the average cost of full-time childcare, $10,470 for an infant, $8,727 for a 4-year-old,” Casey said. “That’s a huge number.”
While the Child and Dependent Tax Credit has worked to provide tax relief for families, only those receiving an adjusted gross income less than $15,000 receive the full benefit, and the credit hasn’t synced with inflation.
“A family today earning $40,000 receives a maximum benefit of only $660 for one child or $1,320 … for two or more children,” Casey said.
That’s why Casey introduced the Child Care and Dependent Credit Enhancement Act of 2015 Thursday.
He said the bill would make the full tax credit accessible for families earning less than $120,000 and would increase the credit from $1,500 to $3,000 per child for kids below the age of five.
“Making the full credit available to most working families,” Casey said. “More than 85 percent of Pennsylvania taxpayers with children will receive the full credit.”
The bill also ensures the tax credit would index benefits to inflation.
“We want to take what has been good policy but make it a lot better and a lot more meaningful to families across the board,” Casey said.
This legislation differs from President Barack Obama’s proposal in that it works to make the credit fully refundable to help lower income families, according to Casey.
He said his legislation would not only help families, but also it would benefit companies and the economy in Pennsylvania and beyond.
“An analysis done by the MIT Sloan School of Management that indicates parents without access to affordable childcare are forced to do one or maybe a combination of the following: reducing their spending on consumer goods, working fewer hours or leaving the labor force altogether,” Casey said, adding that U.S. companies lose $3 billion annually from employees’ childcare related absences.