Gaining Momentum: How the Foster Youth Tax Credit Performed in 2024

In the fall of 2021, JBAY proposed the creation of a new tax credit specifically for foster youth in California: the Foster Youth Tax Credit (FYTC). With the support of former State Controller Betty Yee, Governor Gavin Newsom and the California State Legislature, this new tax credit was included in the FY 2022-23 state budget, funded at $21 million annually.   

In its second year of implementation, the FYTC made significant gains to increase economic security among current and former foster youth in California, which are highlighted in this publication. Specifically, between 2023 and 2024:  

• The number of individuals who claimed the FYTC increased 17%, from 4,782 to 5,587 

• The rate of FYTC utilization grew from 13% to 15%.  

• The total amount refunded from the FYTC increased 20%, from $4,968,047 to $5,982,941. 

• The average tax return for all filers increased 7%, from $1,906 to $2,041.  

• For single filers, the increase was from $1,290 to $1,370 (6% increase).  

• For custodial parents, the change was from an average of $5,343 to $5,265 per filer (1% decrease).  

• The total refunded to current and former foster youth through the FYTC and other state and federal tax credits increased 15% from $10,598,709 to $12,235,954.  

Additionally, in 2024, the rate of poverty experienced by individuals who received the FYTC decreased on average by 7% and among custodial parents by 9%.