Is the Federal Child Tax Credit fair?

Question

This essay got me thinking.

http://www.helium.com/tm/147727/seldom-question-brought-those

But I have got to admit the dude who wrote it sounds like a real blowhard.

But it's not a tax "credit". It doesn't reduce taxable income. It's actually a flat sum awarded per child- an entitlement at the expense of those that don't have kids.

Answer 1

People with children have more expenses than those who don't. If there were no adjustment, a tax based on income would tax them proportionally more than those without children, based on an "ability to pay" concept.

Also, it is a good idea to encourage people to have children, as the US is currently not reproducing its population and the average age is increasing. Without more young Americans, there will be few workers to take care of all the future retirees.

Answer 2

First of all, let me just say that I believe that the Child Tax Credit is very fair to working parents!

Boston is right though---it does not give you a refund or money back so it should not be considered an entitlement. All the Child Tax Credit does is helps reduce your taxes. It is not a refundable credit!

So the writer's real "beef" is this:

"Often times when the "earned income credit" is also taken, parents will actually receive money from the federal government above and beyond the taxes they paid. This is why I put the child tax "credit" in quotes. When the child tax credit becomes an entitlement, it should no longer be considered a tax credit but rather social welfare"

He does not like taxpayers with children getting any type of "hand-outs" apparently, and I'm sure a lot of other childless taxpayers feel the same way. I happen to appreciate tax season when it rolls around since I have 6 children--4 living at home--and could use any tax break I can get!

EDIT: Nope--you are wrong! IT IS NOT A FLAT SUM AWARDED TO PARENTS FOR EACH CHILD! You can take $1000 per child OFF OF YOUR TAXABLE INCOME. If it brings your taxable income down to zero, then you get nothing further, so how can that be a flat sum for each family?

Answer 3

Well, he calls it a "credit" and "entitlement" but he misses one key point: It's not refundable, so it's NOT an entitlement by his definition.