There's a new bill in Congress that would make it easier for single parents to claim all the benefits of the new expanded child tax credit.
The Single Parent Penalty Elimination Act would make it so that single parents can claim the full amount of the child tax credit. It all comes down to restructuring the tax code so single parents, who file as heads of household, can claim the same amount of money per child as those who are married filing jointly.
"No child should receive less nutritious food or less secure housing just because their parent isn't married," said Congresswoman Katie Porter (CA-45), sponsor of the bill and a single mom of three school-age kids.
"There's no discount for single parents at grocery stores, child care centers, or doctors' offices, yet the child tax credit gives less help to single-parent families. I'm proud to introduce legislation today that would eliminate this unfair penalty and give relief to kids in need, regardless of their parents' marital status."
Under the current law, married parents who file jointly can earn up to $150,000 annually and still claim the full amount of the expanded child tax credit. Single parents can only earn up to $112,500 before their credit begins to phase out.
Why does that matter? Consider this hypothetical example from Representative Porter's office:
- The married filing jointly Moore Family has an annual household income of $150,000. They have three children, ages 2, 4, and 5, with estimated annual expenses of $55,848 ($17,628 for child care plus $38,220 for child costs including housing, food, and school supplies). Under the current proposal, the Moore Family will receive $4,800 from the expanded Child Tax Credit.
- The Smith Family, headed by a single parent filing as head of household, has an annual household income of $135,000. They have the same number and ages of children and exactly the same expenses as the Moores. Under the current proposal, the Smith Family will only receive $1,425 in Child Tax Credit.
In this example, the single-parent family earns $15,000 less than the married one. Children in both families have the same needs and expenses—but the single-parent family will only receive one-third of the help from the child tax credit.
Why is the tax system set up this way? Porter's office says that when the code was originally written, it was believed that since single-parent families have one less adult in the home, they would need less money to care for their family. But the child tax credit is meant to support the financial costs raising of children—and those are largely the same, whether you have one or two adults in the house.
The Single Parent Penalty Elimination Act is co-sponsored by Congresswoman Ayanna Pressley (MA-07) and Congressman Don Beyer (VA-08).
"Nearly half of all households with children in the Massachusetts 7th are single-parent households, and with millions out of work due to COVID-19, our single parents need all the help they can get," said Pressley. "My bill with Rep. Porter would fix our antiquated tax code to make it easier for single parents to access the critical relief they need to survive this crisis. This is a racial, gender, and economic justice issue."
In an op-ed for the Washington Post, Rep. Porter wrote, "I've called this the 'single-parent penalty,' but actually those who are hurt are children — the kids who receive less help than goes to children in married households."
"Giving our children what they need to thrive is one of the best investments we can make in our country's future. If legislators are serious about helping all American kids, we need to retire the single-parent penalty," she added.