A Poverty Reduction Analysis of the American Family Act
This fact sheet analyses the poverty reduction potential of the proposed American Family Act. The American Family Act would make the full Child Tax Credit benefit available to families with the lowest incomes and increase the maximum Child Tax Credit available to families with eligible children: families with children under age 6 could receive up to $3600 per young child each year and families with children aged 6 to 17 could receive up to $3000 per older child each year. This proposal informed the Child Tax Credit policy changes enacted for 2021 under the American Rescue Plan signed into law in March 2021.
This fact sheet provides poverty estimates by children's age, race and ethnicity, family characteristics. It provides estimates for children in poverty (below 100% of the Supplemental Poverty Measure threshold), deep poverty (below 50% of the Supplemental Poverty Measure threshold), and in families with low income (below 200% of the Supplemental Poverty Measure threshold). State level results are included.
Our supplemental analysis shows estimates of the antipoverty impacts of the American Family Act relative to the child poverty rate before and after accounting for the Child Tax Credit under law. Impacts are shown for all children under 18 as well as disaggregated by children’s race or ethnicity.
Updated April 20, 2021
Further analysis estimates the anti-poverty effects of Child Tax Credit reforms under the Build Back Better proposal from the US House of Representatives Ways and Means Committee as of September 13, 2021. This proposal would expand the Child Tax Credit in 2022-2025 under similar parameters to the American Family Act, before reverting back to a smaller fully refundable credit amount after 2025. Results are available for all children and by children's race and ethnicity.
Updated September 13, 2021
In our 2019 original analysis of the American Family Act, we found these proposed reforms to the Child Tax Credit could move 4 million children out of poverty and cut deep poverty among children in half.