Oregon has joined at least eight other states in implementing a new or expanded state child tax credit (CTC) since the expanded federal child tax credit expired in 2022. The new Oregon child tax credit, known as the "Oregon Kid’s Credit," is worth up to $1,000 and is completely refundable. That means eligible taxpayers can receive the credit back as a tax refund.
“By providing support during a child’s critical developmental years, the Oregon Kids’ Credit aims to address economic disparities and ensure that every child in Oregon has a strong foundation for life,” said Sen. Wlnsvey Campos (D - Beaverton) in a press release after the state senate approved the tax break.
A 2021 report from Feeding America showed that approximately 106,470 children in Oregon live with food insecurities. That’s nearly double the amount of children estimated to benefit from the new law.
Nearly 55,000 children are expected to benefit from the new credit, according to the Oregon Center for Public Policy. But some children still won't qualify even if their families struggle financially.
Oregon child tax credit: Who qualifies?
One of the reasons financially struggling families may not qualify for the new tax credit is the age restriction. Only children up to age five are eligible for the credit. This leaves families with only older children completely disqualified from the state child tax credit in Oregon, regardless of their income level.
The age requirement is far less strict for the federal child tax credit, which is available to eligible families with children up to age 17. But these stricter age requirements aren’t unheard of in other states.
For example, before New York’s expanded child tax credit was implemented, the state’s child tax credit was only available to children aged four and older. And California’s Young Child Tax Credit is only available to children under the age of six.
Income limit for the Oregon child tax credit
Another eligibility requirement that could disqualify several families from claiming Oregon’s new child tax credit is the income limit.
- Only families with an adjusted gross income (AGI) $25,000 or less are eligible for the full credit amount of $1,000.
- The credit is reduced for families with an AGI of more than $25,000.
- Families making more than $30,000 are completely ineligible to claim the credit.
The federal poverty level for a family of four in 2023 is $30,000. This means some families living below the federal poverty level might not be eligible for the full $1,000 credit. Additionally, the income limit for the child tax credit in Oregon is half of what families of four can make while still qualifying for Oregon’s SNAP (supplemental nutrition assistance program, often referred to as food stamps), which is $60,000.
Advanced child tax credit in Oregon
The credit is effective for the 2023 tax year (meaning eligible families can claim the credit when filing taxes in 2024. And it's unclear whether eligible families will receive advanced quarterly payments for the Oregon child tax credit in the future.
That’s because the provision for advance payments will only become effective if it is determined the payments will not count toward income that may disqualify families from receiving government benefits. According to language in the law, taxpayers will be able to opt out of advance payments. They will also have the opportunity to update information that may affect their payment amount and eligibility (such as a change in income or the birth of a child).
