The bill, titled “An Act to Improve Economic Security for Maine Children by Establishing the Maine Dependent Tax Credit,” aims to replace the existing dependent exemption tax credit from 2023.
Lawmakers in Maine are proposing a new bill that would expand child tax credits from $300 to $350 for each dependent and make the credit fully refundable
The bill would require dependents to live with the claimant for at least six months and receive over 50% of their financial support. Supporters of the bill argue that expanding the Child Tax Credit would help reduce state child poverty by over 12%, benefiting approximately 3,500 children. Advocates say that expanding the credit would also have long-term benefits, such as improving education, health, and lifetime earnings for impacted children.
Opponents of the bill argue that a bigger child tax credit could discourage people from working. However, Josie Phillips of the Maine Center for Economic Policy countered such opposition, stating that the 2021 expanded child tax credit proved to be a lifeline for families during the pandemic. The credit allowed them to weather the financial impacts of the pandemic and meet their day-to-day expenses, making it less stressful for families to afford things like groceries, rent, or childcare, which enabled parents to stay in the labor force.
Expanded child tax credits in 2021
The federal government expanded the child tax credit in 2021 to eliminate the minimum income requirement for parents and raised the credit amount from $2,000 per child to $3,000 per child between six and 17 years old and $3,600 per child between 0 to 5 years old. The child poverty rate is estimated to have dropped to a record low of 5.2% during 2021, with child poverty in Maine dropping by around 40% during the same period.
The bill is currently scheduled for a public hearing, and if approved, the expanded child tax credit would provide much-needed financial support for families in Maine.
READ ALSO: US Marshal’s Arrested A Man Charged Attempted Murder