Congress Avoids Fiscal Cliff

Release Date: January 4, 2013

On January 1, Congress reached a bipartisan deal to avert automatic program cuts and steep tax raises for low income and middle class families. The deal presented a mixed bag of opportunity and future threats for children and working families.


On the positive side, automatic cuts -- also known as sequestration -- set to go into effect on January 1 were delayed for two months. The deal also protected working families from facing major increases in their federal income tax, although slight increases in payroll taxes will be seen by all workers. Tax credits in the 2009 stimulus law that are accessed by low income, working families were extended for five years, including a child tax credit and an expanded earned income credit.


Advocates are on alert though, as automatic cuts to child care subsidy, Head Start, and maternal and infant health programs are still possible later in the year. Congress delayed these cuts until March 2. DVAEYC will be keeping an ear to the ground for the best method for you to message your Congress members shortly to protect vulnerable children and families ifrom these cuts in the coming months.