Child Tax Credit Payments Start in Minnesota

This week, families in Minnesota have begun receiving their share of the state’s child tax credit. It’s the first of three payments aimed at alleviating child poverty. Each family will get, on average, nearly $450, with two more payments set for the end of September and November.

Paul Malquart, the commissioner of the Minnesota Department of Revenue, remarked, “I think for many families, this will be a game-changer.”

Those who filed for the tax credit earlier this year can opt for advance payments, which total up to $1,750 per child in the following spring. The amount a family qualifies for is based on family size and income, with higher wages resulting in lower credit eligibility.

Data from the department indicates that around 220,000 individuals received child tax credits this year when they filed their taxes.

Nine months ahead of the 2025 tax season, families are getting payments that are part of the child tax credit that the Minnesota Legislature approved last year. It resembles the federal initiative that provided $250 to $300 per child from July to December 2021, which was a part of the American Rescue Plan aimed at COVID-19 relief.

According to Malquart, Minnesota is the first among 17 states to implement advance payments for their own child tax credits. He said, “If we can do this, it should enhance flexibility and potentially reduce child poverty.”

Recent studies have evaluated the effects of cash assistance on struggling families. One study published in the New York Times noted that a monthly payment of about $330 did not significantly improve children’s happiness, and those families who received the assistance did not fare better than those who did not.

While Malquart admitted he wasn’t familiar with that particular study, he expressed confidence that Minnesota’s program will show how effective such tax credits can be, mentioning partnerships with Columbia University and the University of Notre Dame to track progress in reducing poverty by a third.

“This is a significant investment and a priority for Minnesota, so we need to be accountable,” he stated.

In December, St. Paul resident Leandra Estis shared her relief that the refundable tax credit could enhance her family budget. She’s looking forward to the advance payment and is one of the participants who opted in.

She emphasized, “Government aid can be helpful, but the aim of the program is really about becoming self-sufficient and improving lives through Minnesota tax credits.”

However, choosing advance payments isn’t suitable for everyone since it might impact eligibility for other programs. Receiving a lump sum during tax season doesn’t have the same consequences.

The state will launch an online calculator next month to help SNAP recipients determine if the payments affect them.

Interestingly, only about 8% of Minnesotans eligible for the Child Tax Credit decided to take early payments, though Malquart is optimistic that participation will grow.

Eligibility for the Minnesota Child Tax Credit

To qualify for a full or partial $1,750 child tax credit, there are income limits set in Minnesota. For single filers, the income must not exceed $29,500 for the maximum refund.

If a family’s income is around $54,534, they will receive a full credit for one child, but that phase-out threshold increases with more children. For instance, a couple with four children earning $90,000 annually can still receive a portion of that credit.