Republican Indiana Sen. Jim Banks introduced a bill Wednesday aimed at providing tax relief for working American families and pregnant mothers.
The bill, called the Family First Act, would increase the child tax credit (CTC) to $4,200 for families with a child between ages 0 to 5 and $3,000 for families with a child between ages 6 to 17 and would allow families to claim the credit for up to six children annually, according to bill text first obtained by the Daily Caller News Foundation. The legislation would also establish a new $2,800 tax credit for pregnant mothers.
“Congress needs to do everything we can to help parents give their kids a shot at the American Dream,” Banks told the DCNF. “My bill cuts taxes, ends marriage penalties, and streamlines benefits to support strong, working families.”
The Family First Act would also require families to earn at least $20,000 to receive the full CTC amount, or at least $10,000 for the full credit during pregnancy, and would also require a parent and each claimed child for the CTC to have a Social Security Number.
The child tax credit was temporarily expanded in response to the COVID-19 pandemic for 2021. It is estimated that the federal child tax credit lifted roughly 2.9 million children out of poverty in 2021, according to the U.S. Census Bureau.
The bill would also eliminate the Head of Household tax filing status. In general, to qualify for head of household filing status, you must be able to claim a qualifying child or qualifying relative as a dependent.
In addition to a variety of reductions in corporate and personal income tax rates, the Tax Cuts and Jobs Act (TCJA) of 2017 increased the child tax credit from $1,000 to $2,000 and raised the maximum qualifying income from $75,000 to $200,000 for single filers and from $110,000 to $400,000 for married couples. Many of the provisions under the TCJA are set to expire at the end of 2025.
Additionally, the legislation would eliminate the State and Local Tax (SALT) tax deduction, which allows taxpayers who itemize when filing federal taxes to deduct certain taxes paid to state and local governments. The TCJA imposed a limit of $10,000 per year, applied equally to individuals and married couples.
Banks’ bill would also simplify the Earned Income Tax Credit, a tax credit which helps low- to moderate-income workers and families in the U.S. get a tax break. The legislation consolidates the family portion of the EITC to not vary based on the number of dependents. Moreover, the legislation would also maintain the adult dependent component of the EITC to ensure no family receives lower tax cuts than the EITC in its current form.
Notably, more than 46 million taxpayers claim the CTC annually, according to a December 2023 report from the Bipartisan Policy Center.
“This year, with the expiration of provisions from the Tax Cuts and Jobs Act, we have a historic opportunity to champion pro-family policies,” Republican Utah Rep. Blake Moore told the DCNF. “The Family First Act will streamline antiquated federal tax policies into an enhanced Child Tax Credit for working families and new tax credit for pregnant mothers. This fiscally responsible approach affirms the dignity of work and promotes marriage, supporting families as they build stronger and more prosperous communities for the next generation. I thank Senator Banks for introducing this bill in the Senate, and I’m hopeful we can get this important initiative across the finish line.”
In January, Moore introduced a similar bill to Banks’ in the House, also titled the Family First Act, which aims to support working American families with an updated and “enhanced” CTC, tax relief for parents with young children and a new tax credit for pregnant mothers.
Banks released a policy document in December outlining his goals for the 119th Congress, which notably included a pledge to “fight for working families.” The Indiana Republican wrote further that “nobody has suffered more because of bad trade and economic policymaking than America’s working and middle classes.”
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