Child tax credit; Virginia adjusted gross income.
If enacted, HB2180 will amend the Code of Virginia, specifically adding a section that outlines the specifics of the child tax credit. Eligible families who exceed the AGI threshold will not benefit from this tax relief, which underscores the bill’s focus on aiding lower to middle-income households. Furthermore, the bill stipulates that if the amount of the credit surpasses an individual's tax liability, the taxpayer will be entitled to a refund, thus further incentivizing compliance among eligible families and potentially increasing state revenue from tax filings.
House Bill 2180 proposes the establishment of a child tax credit for tax years beginning January 1, 2025, through January 1, 2030. This bill allows eligible individuals or married couples filing jointly to claim a one-time credit of $300 for each dependent household member who is younger than 12 years old. The credit is only available to families with a Virginia adjusted gross income (AGI) of $100,000 or less, making it a targeted financial relief measure for middle-income households with children. It aims to support families caring for young dependents by reducing their tax burden.
While HB2180 is largely seen as a supportive measure for families, it may face scrutiny regarding the income limit threshold set at $100,000. Some legislators may argue that this threshold is too low, potentially excluding families who earn slightly above this limit but still experience financial constraints. Additionally, the nonrefundable nature of the credit for nonresidents or certain taxpayers may spark discussions about equity and fairness in tax benefits. The requirement for the Tax Commissioner to develop claiming guidelines may also lead to ongoing debates surrounding administrative efficiency and accessibility for families seeking to utilize this credit.