Congressman Morgan McGarvey Introduces Young Adult Tax Credit Act
WASHINGTON, D.C. (March 5, 2024) – Today, Congressman McGarvey (KY-03) and Congresswoman Bonnie Watson Coleman (NJ-12) introduced the Young Adult Tax Credit Act. This legislation creates a universal $500 monthly payment, indexed to inflation, for all 18 – 24-year-olds in the United States. This cash transfer would allow young adults to access capital earlier in their lives, better afford necessities, or otherwise build their lives and be more integrated into the tax system.
“Our social safety net rightfully has programs for children and seniors, but it doesn’t address the prevalence of young adult poverty. Twenty-two percent of 18-24-year-olds in Kentucky live below the poverty line, and we must do something to help,” said Rep. McGarvey. “Louisville recently conducted a successful pilot program directing payments to young adults so they keep moving ahead instead of falling behind. That’s why I’m proud to introduce the Young Adult Tax Credit and establish a national program that invests in our upcoming generations, allowing them to thrive in and contribute to society for the rest of their lives. This $500 monthly tax credit means someone can make a car payment, buy groceries, pay rent, or afford childcare. I’m excited to work with my colleagues in Congress to move this across the finish line and start lifting young people out of poverty.”
"Young adults face some of the highest rates of poverty in comparison to their older counterparts," said Congresswoman Bonnie Watson Coleman. "I am proud to co-lead this legislation with Congressman McGarvey which put cash transfers directly into the hands of young adults as they navigate this critical point in their lives. Across the nation we've seen the positive affects of people utilizing direct income support -- it puts us on the path to finally abolishing poverty in the United States."
According to the model at PolicyEngine, 22% of all Americans would see an increase in their household income under this program, and it would lift over 4 million Americans out of poverty. This bill would:
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Create an advanced, refundable tax credit, disbursed monthly and indexed to annual inflation adjustments;
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Establish eligibility for 18 – 24-year-olds in the United States who have a social security number (US citizen) OR possess a Tax Identification Number (US immigrants, including DACA recipients and undocumented immigrants); and,
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Direct the IRS to conduct an outreach campaign, prioritizing members of populations that are less likely to file taxes or have bank accounts.
“We owe young people a strong foundation so that they can build healthy and fulfilling lives for themselves and participate fully in their communities,” said Megan Martin, Executive Vice President, Center for the Study of Social Policy (CSSP). “But today, too many young people struggle to make ends meet because we have failed to live up to our collective responsibility, excluding them from government programs and denying them opportunities to pursue their goals. The Young Adult Tax Credit Act is a critical and overdue step forward. It would provide the strong economic foundation all young people deserve— and in doing so ensure a brighter future for us all.”
“It’s a little known fact that young adults have one of the highest poverty rates of any demographic group in the country,” said Dr. Nia West-Bey, Director of Youth Policy at CLASP. “As recently as last summer more than half of young people reported some difficulty meeting their basic living expenses. These are policy choices, and the Young Adult Tax Credit Act represents a huge step forward in our commitment as a nation to advancing economic justice for young adults.”
“New Deal for Youth is proud to have worked with Representative McGarvey on drafting the Young Adult Tax Credit Act," said New Deal for Youth Changemaker Rebecca Do. "We are excited that this bill is being introduced. Now, we need other elected officials to listen to youth voices and pass this landmark piece of legislation. I would probably use [the extra $500 each month] to either pay my rent and groceries, or use it for things that keep me comfortable and living.”
The one-pager can be found here.
The full bill text can be found here.
Endorsing Organizations: Advocates for Youth, Center for Law and Social Policy (CLASP), Center for Popular Democracy, Center for the Study of Social Policy, Kentucky Youth Advocates, National Network for Youth, National Youth Employment Coalition, NETWORK Lobby for Catholic Social Justice, New Deal for Youth (ND4Y), Point Source Youth, Prosperity Now, United for a Guaranteed Income, Young Invincibles
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