New Bill Proposes To Add 700,000 California Families To Young Child Tax Credit

By Ria Roebuck Joseph | Center Square contributor, The Center Square California

February 27, 2023

(The Center Square) - Assemblyman Miguel Santiago (D-Los Angeles) announced today a bipartisan bill to help struggling families in the face of rising inflation. Assembly Bill 1128, coauthored by fellow Assemblyman Tom Lackey (R) and senators Bill Dodd (D) and Lena A. Gonzalez (D) modifies the Personal Income Tax Law.

“This bill would remove the requirement that a qualifying child has to be younger than 6 years of age as of the last day of the taxable year,” Santiago said.

"AB 1128 offers hope for Californians who are struggling to make ends meet by providing much-needed financial relief that puts money back in their pockets to reduce the risk of children falling back into poverty while promoting greater economic stability. California must take action before families are forced into more and harder, impossible tradeoffs," Santiago continued.

Rising inflation presents an ongoing challenge to low- and middle-income families in California. The bill aims at providing a social safety net to the 67% of families with annual incomes under $35,000 who struggled last year to make ends meet.

In California, a salary of $35,000 can be taxed over $6,000 reducing the take-home pay to just below $29,000 at an average tax rate of 17.8%

Rising inflation in The Golden State has compounded the deficit with increased costs in food, gas, and rent.

Specifically, AB 1128 would expand the young child tax credit to include all children of school age i.e., 6-18, and children up to 23 who are students. Children with disabilities of any age are included in the changes.

“These are hard-working families struggling to make ends meet on less than $30,000 a year. California can and must step up to support all children, regardless of age and household income,” said Mónica Lazo, Policy Manager, Golden State Opportunity. “We know that the costs of raising a child don’t stop at six years old, so our support shouldn’t stop either.”

The California Earned Income Tax Credit Coalition is sponsoring the bill and is asking Governor Newsom and the legislature to increase the minimum earned income tax credit to $300 and maintain a budget for free income tax assistance programs.

The bill is unveiled just as pandemic relief programs come to an end and the enhancements to the federal Child Tax Credit and federal Earned Income Tax Credit, which positively impacted child poverty levels during the pandemic, expire.

If enacted, AB 1128 would add 700,000 families to the eligibility of the Young Child Tax Credit with an anticipated return of up to $1,083 per annum, expanding the program to all qualified California Earned Income Tax Credit households.

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