California Child Tax Credit Bill Clears Key Hurdle

(Sacramento, CA) – Today California moves a step closer to providing a pathway out of poverty for low-income families and residents as the Assembly Revenue and Taxation Committee approved the Anti-Poverty Child Tax Credit (AB 2589: Santiago). This legislation creates a Child Tax Credit (CTC) using California’s budget surplus, providing a one-time $2,000 California CTC payment per child to families that earn $30,000 or less per year. While Sen. Manchin blocked the extension of the federal Child Tax Credit, California has a chance to create its own Child Tax Credit. The bill will also increase the minimum California Earned Income Tax Credit (CalEITC) from $1 to $255, giving financial support to California’s low-income tax filers without dependents.

“I want to thank Chairwoman Irwin and the members of the committee for recognizing the vital importance of supporting our lowest-income children and families,” said Assembly Member Miguel Santiago, lead author of AB 2589. “1.7 million children will fall back into poverty if we do not use our historic budget surplus to help these families. The COVID-19 pandemic financial burdened many low-income families and residents, making it vital to provide financial assistance to them as soon as we can.”

“We are thrilled that AB 2589 is moving forward with the support of the Assembly Revenue & Taxation Committee and Chair Irwin,” said Pete Manzo, President and CEO of United Ways of California. “This is a great step toward investing in future prosperity. AB 2589’s $2000 per child tax credit and CalEITC minimum is the most targeted and effective way to reduce poverty, help families dealing with inflation, boost local economies, and improve lifelong results for children.”

“We applaud the leadership of Chair Irwin and the honorable members of the Assembly Revenue & Taxation Committee for putting our kids first by passing AB 2589," said Shimica Gaskins, President & CEO at GRACE. "These past couple of years have been especially challenging for low-income families and their children, as the COVID-19 pandemic has compounded and further widened the socioeconomic inequities faced by these families. And although the federal expanded Child Tax Credit payments have expired, the economic consequences of the COVID-19 pandemic still remain. AB 2589 is a smart, targeted investment of California's surplus that that will ensure low-income families with children are the first beneficiaries of any relief solutions."

"Today California's children and families are closer to getting the help they need to pay for rising costs. We applaud Chair Irwin and the committee members for putting children first," said Amy Everitt, President of Golden State Opportunity. "The best way to end child poverty is to prevent it. AB2589 does just that. "

AB 2589 provides a one-time child tax credit payment to low-income families who qualify for the CalEITC or California’s YCTC. The bill also increases the minimum CalEITC award from $1 to $255 to help support low-income tax filers without dependents. This means that families could receive anywhere from $8,000 to $16,000 in Child Tax Credits, creating a pathway out of poverty for low-income families and residents. AB 2589 will be heard in the Assembly Appropriations Committee in May.

Assembly Member Miguel Santiago is the Chair of the Assembly Committee on Governmental Organization and Chair of the Assembly Select Committee on Los Angeles County Homelessness. He also sits on the Assembly Committees on Public Safety, Health, Higher Education and Utilities and Energy. He represents the 53rd District composed of the cities of Los Angeles, Huntington Park, and Vernon.