The ARP’s new Child Tax Credit spells relief for American farm families

The American Rescue Plan of 2021 has another major surprise squeezed into its 242 pages of text. Not only does the new COVID relief package take a big step to lift farmers of color out of economic despair, it takes another big step to lift children out of the vicious cycle of poverty – four million to be exact. The Child Tax Credit is currently a credit that taxpayers who owe tax can take at tax time – these taxpayers see their tax liability reduced by $2,000 per child. Taxpayers who don’t owe any taxes get a smaller amount – $1,400 per child, in the form of a check. The benefit was for children under 17.

The new law increases the credit to $3,600 for children under six and 3,000 for children six and over, raises the age limit to under 18, and also eliminates the disparity between payments for people who have tax liability and those that don’t – now the payments are the same for each group. Another exciting piece is that half of the payment/credit will be made at tax time, and the other half will happen on a monthly basis with the government sending between $250 and $300 per child depending on the age, between July and December of 2021. (But see this CNN article that says the IRS is struggling to juggle it all and payments may be delayed – oh no!)

Direct payments from the government, to help may for food, diapers, and day care! This may sound like the government just doing what it’s been doing for the last year and sending out another round of checks. But, the reality is that… Wait for it… THIS. IS. REVOLUTIONARY.

Seriously. This is not a NEW idea mind you. Currently 17 countries including Canada, Ireland and Sweden make direct payments to families with children. But, this is NEW that the United States is…maybe not fully and embracing in a big bear hug the idea that maybe, just maybe, it’s a good idea to invest in children because well, they are the freakin’ future!

It’s a $100 billion investment to run this program for a year. But, policy analysts predict that Columbia University researchers estimate that the program will generate “more than $800 billion in benefits to society through better health for children and their long-term outcomes.” See CBS Article on Child Tax Credit.) This seems like a pretty good investment, right?

It’s also an investment that could reap benefits in rural America. Rural America has a childcare problem. Families flock to the country to raise their kids on the fam but then…they have to farm and well, where do the kids go? On the tractor with mom and dad? Out in the fields and pastures all day working alongside the parents doing the back-breaking work? Probably not. Farming can be dangerous work and children want to play. Play time and farm time are not synergistic activities.

The reality for many farm families is that there is a dearth of childcare options in the country and driving an hour to the daycare center in town is not a convenient option so one of the parents (let’s face it, usually the mom) ends up being the one with the kids and mom is shut out of farming and the marriage breaks down and the rest is history…

Ok it may not be that bad, always…. But, it sure would be helpful if there were reliable and available childcare options near the farm… Well, this new and improved Child Tax Credit may be the answer! Imagine an extra $600 per month for a family with two kids – this could go along way towards hiring a babysitter. Imagine if everyone down the country lane with kids now had an extra $600 per month to put towards childcare. The possibility of pooling money together to hire several care providers seems that much more attainable.

It’s not here quite in time for the farm season to begin, but it’s coming soon…Farm families, you might want to start thinking of creating some (COVID-safe) child care pods here soon…

The New York Times has a very insightful and informative article on the new and improved Child Tax Credit and what it could mean for children and families in America. Read it and understand just how revolutionary this really is.