New York State is rolling out a significant financial relief package aimed at supporting families and individuals facing economic challenges.
This comprehensive plan includes expanded child tax credits, direct stimulus payments, middle-class tax cuts, and free school meals, collectively offering up to $5,000 in annual savings for eligible families.
Expanded Child Tax Credit: Up to $1,000 Per Child
A central feature of the relief package is the expansion of the Child Tax Credit. Families will now receive up to $1,000 annually for each child under the age of four and $500 for children aged four through sixteen.
This enhancement is expected to benefit approximately 1.6 million families and nearly 2.75 million children across the state.
The average credit per family will nearly double, increasing from $472 to $943. For instance, a family with a toddler and a school-aged child earning up to $110,000 annually could see their credit rise to $1,500 per year. Even families with incomes up to $170,000 may now qualify for partial benefits.
This expansion is projected to reduce child poverty in New York by 8.2%, and when combined with other measures like subsidized child care, the reduction could reach 17.7%.
Inflation Refund Checks: Automatic Payments Up to $400
To address the rising cost of living, the state will issue one-time inflation refund checks later this year. These payments will be automatically distributed based on 2024 tax returns, requiring no additional action from recipients.
Eligible households will receive:
- $400 for joint filers earning up to $150,000
- $300 for joint filers earning between $150,001 and $300,000
- $200 for single filers earning up to $75,000
- $150 for single filers earning between $75,001 and $150,000
Over 8 million New Yorkers are expected to benefit from these payments, which aim to alleviate financial pressures caused by inflation.
Middle-Class Tax Cuts: Historic Reductions
The relief package also includes significant tax cuts for the middle class, marking the lowest tax rates in New York in 70 years. More than 75% of taxpayers, approximately 8.3 million individuals, will benefit from nearly $1 billion in annual tax relief.
These cuts will provide substantial savings for joint filers earning up to $323,000, putting more money back into the pockets of working families.
Free School Meals: Saving Families $1,600 Per Child
Starting this year, all 2.7 million public school students in New York will receive free breakfast and lunch, regardless of household income. This initiative is expected to save families approximately $165 per month per child, totaling nearly $1,600 annually.
Beyond financial savings, free school meals have been shown to improve academic performance, attendance, and overall student well-being.FingerLakes1
Additional Federal Support: IRS Recovery Rebate Credits
In a separate federal initiative, the IRS is issuing automatic payments of up to $1,400 to approximately one million taxpayers who did not claim the Recovery Rebate Credit on their 2021 tax returns.
These payments are being distributed without the need for any action from eligible individuals and are expected to be completed by late January 2025.
Taxpayers who have not yet filed their 2021 returns have until April 15, 2025, to do so and claim any credits they may be entitled to.
Conclusion
New York’s comprehensive relief package is a significant step toward easing the financial burden on families and individuals across the state.
By combining expanded tax credits, direct payments, tax cuts, and free school meals, the state aims to provide meaningful support to those who need it most.