As Congress Returns to Washington, Data Show the Expanded Child Tax Credit is Working in West Virginia
Charleston, WV—September 14, 2021—In March of 2021, the American Rescue Plan Act made significant but temporary changes to the Child Tax Credit (CTC). In addition to increasing the value of the CTC and including more families in this critical support, ARPA included the flexibility for eligible families to choose to receive the CTC payments monthly – as opposed to receiving the full benefit after filing taxes. This small but significant change allows families to utilize the money in real-time to pay for their households’ individualized needs and invest in their children. The first of these advanced payments arrived in July, and data is already showing the positive impacts that they are having on West Virginia families.
Initial data from the United States Census Bureau’s Household Pulse Survey shows a significant decrease in food insufficiency immediately after households received the first advanced CTC payment. Prior to receipt of the payment, 11.6 percent of West Virginia adults in households with children reported food insufficiency. By the end of July, two weeks after receipt of the first payment, that number had declined to 8.4 percent.
The millions of people across the country, including 93 percent of households with children in West Virginia, benefiting from the CTC expansion are more than just numbers. Recent research from SaverLife, a nonprofit that helps families build lifelong saving habits, lends insight into what these payments mean for everyday West Virginians, such as Becky Dillon. Becky is a customer service representative in Bluefield, WV who was forced to begin working remotely from home due to the pandemic, as well as the mother of a 10-year-old daughter who similarly was required to shift to remote schooling. This transition to at-home working and learning was challenging in many ways and created increased costs for the Dillon family, like heightened broadband and electricity bills.
Receiving advanced CTC payments helped ease this difficult transition. Thus far, Becky has received two advanced payments and she reports using the funds to help pay for her utility bills and groceries. “[The recently expanded Child Tax Credit] gives stress relief, because I can count on the extra money coming in, in case something should happen, or if I should need a few extra dollars toward the next bill,” she says.
Becky is not alone in using her CTC payments to keep her family afloat and invest in her child’s well-being. SaverLife found that 83 percent of families nationwide are using the CTC payments to pay for basic living expenses like rent and groceries, and 75 percent are spending a portion of the funds on clothing for their children.
What’s more, if this currently temporary CTC expansion is made permanent, additional survey findings from SaverLife indicate that low-to-moderate-income families would make long-term changes to enhance their households’ financial security and work toward a better life for their loved ones, spending portions of the payments on goals like moving to a new home and starting a college fund for their children.
Now, with Congress returning from August recess to continue negotiation of the next recovery package, making the CTC expansion permanent and these dreams within grasp is possible.
“According to both qualitative and quantitative metrics, the expanded Child Tax Credit is working to reduce hardship and economic insecurity in West Virginia,” states WVCBP executive director Kelly Allen. “As Congress returns to Washington, our representatives have the opportunity to ensure that the benefits of this credit expansion can continue and even grow so that families will have the security of knowing they can consider investing their CTC payments in longer-term needs like college funds and new homes. We urge our federal delegation to prioritize swift passage of a robust Build Back Better recovery package that includes the permanent expansion of the enhanced Child Tax Credit.”
Of note, if all West Virginians who are eligible are able to access the expanded CTC, 346,000 children would benefit statewide, including 50,000 who would be lifted above or closer to the federal poverty line.
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The West Virginia Center on Budget and Policy is a public policy research organization that is nonpartisan, nonprofit, and statewide. The Center focuses on how policy decisions affect all West Virginians, especially low- and moderate-income families.
SaverLife is a nonprofit whose mission is to create prosperity for working families by helping them save and invest in their futures.
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