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Federal Child Tax Credit Plan Would Reach More Than 250,000 TN Kids

July 29, 2008

Nashville, TN – Federal child tax credits could soon go to more Tennessee working families with kids. The Senate is set to vote this week on updating the Child Tax Credit. Right now, only families making more than $12,000 a year see any benefit. The House already has approved extending the credit to lower-income families.

Lissa McLeod with the Children's Defense Fund of Tennessee says 250,000 children in the state would benefit, adding that it's exactly the right kind of targeted tax reform needed during this weak economy.

"More money is staying in families and helping lift them out of poverty. We're really talking about families here that make between $8,500 a year and $12,000 a year."

McLeod says it's a refundable credit, meaning that even if a family owed no income taxes, they could file for the refund. Critics of the plan say if the families don't pay federal income tax, they should not receive a refund. McLeod counters that even when families earn too little to file income tax forms, they still pay all sorts of other taxes.

"Families pay the same amount of taxes if they go into the grocery store to buy a loaf of bread, whether they make $80,000 a year or whether $8,000 a year. Low-income families need these tax refunds."

Deborah Smith/Kevin Clay, Public News Service - TN