Press Releases

Today, Congressman Salud Carbajal (CA-24) joined an overwhelming majority of the U.S. House of Representatives to advance a bipartisan tax package which will lower costs for Central Coast families through an expanded Child Tax Credit and housing affordability tax credits, as well as provide additional support for small businesses and families affected by recent natural disasters.

The expansion and improvement of the Child Tax Credit, which includes increasing the maximum refundability of the credit and indexing the credit to inflation, is projected to help 34,000 children on the Central Coast and more than 2 million California children in its first year.

The tax package also expands the Low-Income Housing Tax Credit to allow states to support the creation of more affordable housing projects.

“With partisan gridlock at an all-time high, I’m pleased to see that Congress can still come together to reach a compromise on critical measures that will help Central Coast families by lowering their cost of living, promoting affordable housing, supporting small businesses, and helping those impacted by recent natural disasters. It is also worth noting that these investments are paid-for through offsets to avoid adding to our national debt,” said Rep. Carbajal. “While this deal isn’t everything my Democratic colleagues and I would have hoped for, it is a down payment on the kinds of investments we want to make in American communities, and I am confident it will make a difference in the lives of Central Coast families.”

Under the tax agreement, the refundable child tax credit available to low-income families would rise from $1,600 this year to a projected $2,100 by 2025, and the income cap on the credit will expand to account for the number of children in a family.

One analysis found that this expansion will lift half a million children out of poverty over the next two years.

“In 2021, Congressional Democrats and President Joe Biden proved with the American Rescue Plan that expanding the Child Tax Credit was an effective way to put money back in the pockets of working families, lifting millions out of poverty and helping put food on the table for children across America,” said Rep. Carbajal. “This tax bill’s expansion of the Child Tax Credit has important steps, from raising the maximum credit that lower-income families can receive to indexing the credit to inflation, but I will continue fighting to restore the full expanded Child Tax Credit that was proven to be the gold standard at helping millions keep more money in their pocket.”

The package also provides tax relief to families affected by natural disasters by making wildfire relief payments received in 2020 or later for losses resulting from a federally declared wildfire exempt from income tax calculations.

The bill also allows victims of a federally qualified disaster to claim a tax deduction for related casualty losses that exceed $500, in addition to claiming the standard deduction. This provision applies to disasters beginning in 2020 through the enactment of this bill.

The bill now heads to the U.S. Senate for consideration and passage before heading to the desk of President Joe Biden for his approval.