Newborn tax credit failed to pass this session. Here's what advocates have to say

A proposal to give eligible families a $500 tax credit for newborns failed to pass this legislative session. Advocates continue to push for the tax credit they said would improve Hoosiers' financial stability and health.

Olivia Smith is a policy analyst with the Indiana Community Action Poverty Institute. She said newborn tax credits are essential for families already facing thousands of dollars in combined costs for diapers, child care and other expenses during the first years of a child's life.

"If this did pass, you know, it would have really alleviated a lot of the stress that goes into that first year of life for parents," she said.

READ MORE: Senate lawmakers advance an up to $500 newborn tax credit for Hoosier parents
 

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Smith said that alleviated stress translates into outcomes later in a child's life.

"That leads to increased earnings at adulthood for those children, reduced health care costs for those children, fewer expenditures related to crime," Smith said.

While Senate Bill 497 failed to pass, Smith said she's encouraged by the support from Hoosier families and legislators. There are currently more than a dozen states with a child tax credit — and Smith believes Indiana will be one of them in the future.

Timoria is our labor and employment reporter. Contact her at tcunningham@wfyi.org.