Klobuchar, Cassidy, Jacobs Lead Bipartisan Bill to Help Families Claim the Child Tax Credit After a Natural Disaster

WASHINGTON - U.S. Senators Amy Klobuchar (D-MN) and Bill Cassidy (R-LA) and Representative Sara Jacobs (D-CA-51) today introduced the Working Families Disaster Tax Relief Act to allow disaster-impacted working families to use the previous year's income to claim the Child Tax Credit (CTC) and the Earned Income Tax Credit (EITC) after a presidential major disaster declaration.

This will prevent families from losing access to these benefits due to temporary income loss. Congress has authorized similar temporary provisions for both the CTC and EITC following recent major disasters, and for all taxpayers nationwide during COVID-19 in 2020 and 2021.

"In the wake of major disasters, Americans should not have to worry about their taxes increasing while at the same time losing pay that causes them to no longer qualify for the Child Tax Credit and Earned Income Tax Credit," said Klobuchar. "Our legislation allows taxpayers in federally declared major disaster areas to use their prior-year earned income when calculating eligibility, ensuring they don't get penalized for income drops that are caused by disasters and outside their control."

"When natural disasters hit, many working families lose their jobs, become furloughed, face business interruptions, or suffer property losses that can affect their ability to work. But unfortunately, existing law requires people to use their current year's income to claim the Child Tax Credit, meaning those who've experienced natural disasters could suffer a double financial hit - losing both their income and their ability to claim the Child Tax Credit," said Jacobs. "That's why I'm proud to introduce the Working Families Disaster Tax Relief Act alongside Senators Klobuchar and Cassidy to change this and ensure families can use the previous year's income to claim the Child Tax Credit and provide financial support for children's well-being during a Presidential-declared major disaster."

The Working Families Disaster Tax Relief Act would:

• Amend the Internal Revenue Code to allow disaster-affected taxpayers to use a previous year's income for the Child Tax Credit when the President declares a major disaster under the Robert T. Stafford Disaster Relief and Emergency Assistance Act.
• Designate disaster-affected taxpayers to include individuals whose principal place of abode or principal place of work is located in a disaster zone.

The bill is endorsed by the First Focus Campaign for Children, Americans for Tax Fairness, AICPA & CIMA, MomsRising, CLASP, and Chamber of Mothers, National Women's Law Center Action Fund, Network Lobby, Economic Security Project Action, Coalition of Human Needs, and Zero to Three.

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