Covenant House Newsroom

Two key tax credit provisions in the COVID-relief legislation that the Senate will consider this week would provide significant help to families and young people at-risk of homelessness from the economic effects of the pandemic.

First, the House's Child Tax Credit (CTC) expansion would deliver significant additional income to children and their families with low household income, making the full credit available to 27 million children — including roughly half of all Black and Latino children and a similar share of children who live in rural areas — whose families now don’t get the full credit because their parents’ earnings are too low. This would lift another 4.1 million children above the poverty line, reducing the remaining number of children in poverty by more than 40 percent.

The provisions also include an Earned Income Tax Credit (EITC) increase for working adults not raising children in the home. This change to the EITC would expand the benefit for over 17 million adults who are not raising children at home. This would raise the maximum EITC for childless adults from roughly $530 to roughly $1,500 and raise the income limit to qualify for the childless workers’ EITC from about $16,000 to at least $21,000. It would also expand the age range of childless workers eligible for the tax credit to include younger adults aged 19-24 who aren’t full-time students, as well as people 65 and over.

“We applaud Congress for leading on expanding the Child Tax Credit, which can transform the lives of many children and families currently living in poverty,” said Covenant House International President Kevin M. Ryan. “The young families that Covenant House serves, whether experiencing homelessness or at-risk of homelessness, would immediately benefit from the CTC and create a path forward out of poverty and into opportunity. This is a great first step in offering a more stable future for all children and families.”

At Covenant House, where close to 90% of the youth we serve in the U.S. are people of color, including more than 60% who are Black and African American, we help young people recognize both the impacts of racism that are part of their lived experience and their own capacity for resilience. These provisions in the latest COVID-relief bill are a down payment on ending child poverty and could lead to the largest reduction in child poverty rates in decades. 

Covenant House serves almost 2,000 young people experiencing homelessness each night in 31 cities across six countries.  “Our young people are resilient, brave, strong, hard-working, and filled with promise,” said Ryan.  “These provisions are empowering, they are right, and on behalf of our young people, I urge every American to let their voices be heard and support the Child Tax Credit and the Earned Income Tax Credit. The time to act is now.”