Every day, somewhere in California, a grandparent gets a call from Child Welfare with a stark message: Their grandchildren are being taken out of their parents’ custody and need family to care for them, or else the children will end up in the foster system.
Of course these grandparents, overwhelmingly, say yes and take their loved ones in. This is what we do for family.
But for many of them, especially those who are older, retired and living on fixed incomes, the unexpected addition of extra mouths to feed, extra shoes to put on growing feet and all the other expenses of raising children, can add up to a heavy financial burden that they were not prepared to carry.
Helping these elders who are helping raise the next generation — almost always because of awful family circumstances such as incarceration, drug abuse, psychiatric problems, or even death — is why I am carrying Senate Bill 1096 this year.
California’s taxes are high, but the tax code does provide some relief to families to offset the costs of raising children. In particular, the California Earned Income Tax Credit — up to $3,756 — can cut tax bills and provide cash refunds to working families with children.
But for seniors drawing Social Security or pensions, or living off any savings they may have, the Earned Income Tax Credit does not apply. It is only for those still in the work force.
But the costs of raising children aren’t lower if you are 65 instead of 35.
SB 1096 creates a senior tax credit for those over 65 who are not in the work force, providing comparable relief to that available for younger families.
After conversations with my colleagues in the Senate, it has been amended to narrow the scope:
It now includes an income cap that phases out the credit for taxpayers with incomes above $150,000.
It excludes families receiving payments from state or local foster programs.
Both of these changes target relief to the families who need it the most.
California faces a difficult budget challenge this year. The state has committed too much money to too many programs without the revenue to pay for them all consistently. I wish the timing were better for a new tax credit.
But California also faces a cost-of-living crisis. Every one of us feels the squeeze at the gas pump and the grocery store, but nobody more so than seniors on fixed incomes. Throw in unexpected new dependents, and many of them are truly hurting.
Frankly, California also has an exceptionally difficult time finding families for the children in the foster system, and it pays far more to place children in homes than this tax credit would cost. If we can keep more children in loving homes with their senior relatives by supporting that family care, it will only ease the pressure on an overloaded foster system.
Grandparents who take on the work of raising their grandchildren are already stretching far beyond what most of us expect in our retirement. I hope the Senate will take a new look at SB 1096 and give these struggling families some overdue relief.