*Research Report SPI Household Financial Survey Household Financial Survey

Employment, Financial and Well-being Effects of the 2021 Expanded Child Tax Credit: Wave 1 Executive Summary

The 2021 temporary expansion of the Child Tax Credit (CTC) is unprecedented in its reach and is predicted to cut American child poverty by more than half. The expanded CTC provides families with $3,600 for every child in the household under the age of six and $3,000 for every child between the ages of six and 17. Almost all middle-and low-income families with children are eligible for the CTC. Married parents making less than $150,000 and single parents making less than $112,500 per year will receive the full amount of the credit, which begins to phase out slowly after these income cut-offs.

The purpose of this report is to analyze the impact of the CTC on families and to inform current proposals to make the credit permanent. In this summary report, we highlight key findings from the first wave of the study, focusing specifically on how families plan to use CTC payments and their initial perceptions of the expanded credit. The survey was administered between July 8 and July 13, 2021—immediately before the first CTC payments were delivered.

The full report, examining the impacts of the CTC on families relative to a comparison group of households ineligible for the CTC, is forthcoming in early 2022.

Citation

Hamilton, Leah; Roll, Stephen; Despard, Mathieu; Maag, Elaine; and Chun, Yung. “Employment, Financial and Well-being Effects of the 2021 Expanded Child Tax Credit: Wave 1 Executive Summary” (2021). Social Policy Institute Research.