At Atlanta preschool, Ossoff says child tax credit can reduce poverty

School nurse Johnnie Thomas – Nurse Johnnie to the kids at Atlanta’s Sheltering Arms Educare Center preschool – sees the effects of child poverty first hand.

Most of the students receive financial aid to attend classes there, and about 98% of the families served by the school meet the financial eligibility requirements for Medicaid, Thomas said – that’s an income of about $52,000 per year for a family of four. Children in the area near downtown suffer from chronic illnesses like asthma, allergies, eczema and diabetes at the same rates as elderly populations, Thomas said. She’s helped students fighting cancer and congenital birth anomalies.

“Poverty affects your access to education, your access to health care, your access to healthy foods, and that’s what we’re seeing manifest in this situation,” she said. “We serve about five different communities in this neighborhood, Mechanicsville, Adair Park, Peoplestown, Summerhill, and this same community has been plagued by poverty. That’s what we haven’t changed by putting me here and this great school here, we haven’t been able to change some of the systemic issues, but we’re here to help mitigate the impact on them so that these families can get on a different trajectory for their children.”

Thomas was on hand Tuesday as Georgia U.S. Sen. Jon Ossoff stopped by the school to promote a provision of the American Rescue Plan the White House intends to help mitigate the barriers children living in poverty confront.

Starting July 15, Georgia families making up to $150,000 per couple or $112,500 for a single parent, will begin to receive $300 in monthly tax refunds for each child under six and $250 per child from six to 17.

“This is going to be a huge benefit to families in Georgia,” Ossoff said. “You know, there are so many families in our state who still have credit card bills piling up and can’t afford the light bill, the gas bill, the car payment, the mortgage, child care services that we’re underinvesting in. And so that’s why we’ve worked so hard to deliver this tax cut for working class and middle class families.”

The plan is an expansion of the existing child tax credit from $2,000 to $3,600 for children under six and $3,000 for older children. Half of that credit will come in advance monthly payments between July and December.

If you regularly filed your taxes, you will receive the payments automatically like the stimulus check earlier this year, through a direct deposit, a paper check or a debit card. Georgians who did not file 2019 or 2020 taxes can sign up to receive payments at the IRS website.

In addition to increasing the amount of payments and age eligibility, the White House plan makes the child tax credit fully refundable, meaning that families with earnings that are too low to incur federal income taxes will be able to benefit from the payments. 

The expansion is expected to cut child poverty in half, reduce total poverty from 13.6% to 5.9% and lift nearly 700,000 Georgia children near or above the poverty line, according to the Georgia Budget and Policy Institute. And it promises a disproportionately beneficial effect on the 470,000 Black Georgians under 17 who now do not qualify for the tax credit because their families’ incomes are too low.

Making sure Georgians don’t suffer from the effects of poverty when they are young will pay big dividends in the future, said Mindy Binderman, executive director of GEEARS: Georgia Early Education Alliance for Ready Students.

“Research shows that children who live in poverty for any amount of time can suffer negative lifelong consequences, including lower earning, educational attainment levels and poorer health,” she said, “And that’s why the children’s tax credit that provides such major relief and can really help us end child poverty is so critically important.”

Though it will have an outsize effect on the poorest Georgians, the payments will reach all but the highest-earning Georgians, Ossoff said,

“This is a major announcement that gets to the household finances of more than 90% of Georgia families,” he said. “We have passed major tax relief for working and middle class families in Georgia. This is not tax relief for corporate America. This is not tax relief for ultra-wealthy people.”

President Joe Biden is facing calls to make the expanded child tax credits permanent — his American Families Plan that is before Congress would make the credit fully refundable permanently, but the other expansions would expire in 2025.

Efforts to make the credit permanent are likely to face resistance from Republicans and some Democrats worried about the potential cost. An analysis by the Tax Foundation finds making the credits permanent would cost $1.6 trillion over 10 years.

Ossoff said Tuesday he supports making the credits permanent and is in discussions with the White House and other members of Congress to do so.

Nurse Thomas said she’s hopeful lawmakers will see the benefit of the plan for children like the ones she cares for and decide to make it permanent.

“I think we’ll see the need manifested by what is happening now, what we’ve gone through during the pandemic,” she said. “I think a lot of things have been revealed in that months-long process of contending with the social situation and circumstances, and I’m hopeful that this will be a building block, a stepping stone towards something sustainable.”