Americans who live in a state can receive a Child Tax Credit of as much as $2,000 for each of their children up to age 17. They receive smaller amounts for kids 17 and 18 and for college students up to age 24. If the family paid in less than the amount of their tax credit, they can still receive as much as $1400 from the federal government or each qualifying child.
In Puerto Rico, the rules are a bit different. The child tax credit kicks in only when a Puerto Rican taxpayer has a third child. There is no credit available for the first two children born in a family.
There is no Child Tax Credit available at all for Puerto Rican families with only one or two children. Coincidentally, Puerto Rico has the lowest birth rate in the United States, with just 1.3 children per woman.
Support for Child Tax Credit in Puerto Rico
In a recent meeting with U.S. Treasury Secretary Steve Mnuchin and Governor Wanda Vazquez, Resident Commissioner Jenniffer Gonzalez-Colon discussed the possibility of extending the Child Care Tax Credit to Puerto Rico.
Senators Marco Rubio (R-FL) and Bob Menendez (D-NJ) have introduced the “Child Tax Credit Equity for Puerto Rico Act of 2019”, and Gonzalez-Colon introduced an identical House version with ten bipartisan cosponsors.
In June, comprehensive legislation passed by the House Ways and Means Committee to reduce poverty and provide an economic boost for middle-class families included an expansion of the Child Tax Credit for Puerto Rico and the four other U.S. territories.
In May, Amanda Rivera Flores, the Executive Director of Instituto Desarrollo Juventud, testified before the House Natural Resources Committee in favor of expanding the Child Tax Credit to Puerto Rico.
Noting that the proposal “has garnered bipartisan and bicameral momentum,” Ms. Rivera Flores told the Committee that “we must ensure this Congress does not end without passing” the legislation.
“It’s the very least that can be done,” she added.
Earlier this year, Sen. Sherrod Brown (D-OH) included a Puerto Rico CTC expansion in his popular Working Families Tax Relief Act.
In 2016, the bipartisan, bicameral Congressional Task Force on Economic Growth in Puerto Rico unanimously recommended extending the Child Tax Credit to Puerto Rico to combat child poverty and stimulate the economy.
It is estimated that the extension of the tax credit would benefit 355,000 families in Puerto Rico.
Some observers object that Puerto Rico taxpayers do not pay income taxes. However, the Child Tax Credit is refundable for stateside families that pay no income taxes.
Updated on October 20, 2019.