CHILD TAX CREDIT

How has the 2021 Child Tax Credit helped US families?

A recent survey shows that the initial advance payment on the 2021 Child Tax Credit is making a difference for American families with children.

0
How has the 2021 Child Tax Credit helped US families?
WILLIAM WEST AFP

The first payment from the enhanced Child Tax Credit for the 2021 fiscal year is already having a significant impact on millions of American households. The payments began 15 July and now the second of six installments should be in the bank accounts of recipients.

Data from a survey of parents showed that the money provided peace of mind for a majority of families and made a huge difference for just over half. The vast majority want to see the payments continue beyond the end of 2021 when they are due to expire.

2021 Child Tax Credit payments made a “huge difference”

Although the US economy is recovering from the financial crisis brought on by the covid-19 pandemic, many families are still dealing with hardship and raising a child is not cheap. A survey conducted after the first installment by ParentsTogether Action, a national family advocacy nonprofit, found that 50 percent of parents said the July payment “made a ‘huge difference’ to their family’s economic security.” Another 40 percent found the payments helpful.

Financial anxiety among those that took part in the survey was reduced for 56 percent with the vast majority, 79 percent, using the funds immediately. Over 48 percent of respondents put the funds toward purchasing food, with 11 percent buying more nutritional food for their kids. “I really want to buy healthier food for my son but it’s usually more expensive,” Cerena C. of Glendora, California told the survey.

This is reflected in new research from US Census Bureau which also showed there was a quick drop in the rate of hunger across the US after the first payment of the Child Tax Credit.

The other primary areas that respondents said the money went toward included utilities at 45 percent, rent at 29 percent and childcare costs at 13 percent.

Parents want Child Tax Credit payments to continue beyond 2021

The payments will continue until the end of the year when the program will expire if Congress doesn’t extend it. Democrats are currently working on legislation that would be included as part of the Build Back Better reconciliation budget package which they plan to pass along party lines. Families could see up to $1,800 this year for each child under 6 and $1,500 for children 6 to 17 at the end of 2021. For 65 percent of respondents the remaining monthly payments will make a “huge difference.”

There was consensus among respondents about wanting Congress to pass legislation to keep the payments coming beyond December 2021 with 80 percent saying it was “important” while 70 percent said it was “extremely important.”

If made permanent 57 percent said their mortgage or rent would be more manageable, and possibly even move if they wanted to. Respondents also said that they could start building their own safety net for emergencies or begin saving for their child's future.