Can Iowa families with children get tax savings next year?

DES MOINES, Iowa (Iowa State Capitol Bureau Gray Media) – An Iowa lawmaker says Republicans are discussing ways to make raising children cheaper for families. State Rep. Devon Wood of New Market said the concept is still in the early stages of discussion, but action is possible when the Legislature begins its new session in January.

“On our end, one of the big themes was, are we looking at something like a child care tax credit for some of these people who are struggling?” Wood spoke to an audience of child care providers and care center operators/owners at the Iowa Women’s Foundation’s “Iowa Solutions Summit: Child Care” in Altoona on Tuesday.

“We’ll look at… maybe more of a deduction situation? Is this what we do? Is this the next solution? – said Wood.

Wood’s response indicated that Republicans, who will hold majorities in both the House and Senate, have several options to consider. One could focus on tax savings aimed at helping families pay for child care costs. Another might look at the total tax credit for each child. Or lawmakers could consider some other type of tax savings for families.

Sen. Janice Weiner, an Iowa City Democrat, said she would like to see lawmakers consider something similar to the child tax credit the Biden administration did at the federal level.

Families could receive $300 each month ($3,600 annually) in their bank account for each child under six years of age. Families with children ages 6 to 17 will receive $3,000 per year per child.

The Brookings Institution said the 2021 child tax credit reduced child poverty to a record low.

See the Brookings Institution report here.

Weiner said: “I am raising a seven-year-old girl and my granddaughter has been in child care for several years. So, I totally understand how difficult it is to find child care… how difficult it is to find affordable child care.”

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