Studies show gains versus hunger lost with tax credit ending – The 74
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An article in the Journal of the American Medical Association in October confirmed previous research that food insecurity increased significantly after the monthly Federal Child Tax Credits expired on January 15, 2022.
The study looked at the period between January and July of this year in a series of national surveys and found an almost 25% increase in food inadequacy, affecting black, Hispanic and Indigenous families the most.
The article published Oct. 21 in JAMA, “Association of the Expiration of Child Tax Credit Advance Payments With Food Insufficiency in US Households,” involved a cross-sectional study of repeated surveys of a nationally representative sample of 592,044 US households.
“The results of this study suggest that loss of monthly payments (child tax credit) was associated with an increased prevalence of households with children in the United States reporting sometimes or often not having enough to eat, a condition associated with adverse health effects across the lifespan,” the paper concludes.
Monthly American Rescue Plan Act (ARPA) Child Advance Tax Credit (CTC) payments were administered to more than 35 million households with children in the United States between July and December 2021. Center figures on Budget and Policy Priorities show the appropriations benefited about 2.37 million children in Ohio. Tax credits were associated with a substantial decrease in food insufficiency, according to the study.
Under ARPA, three major changes to the credit have been enacted for the 2021 tax year: an expansion of eligibility to include families with very low or no income; an increase in credit amounts from a maximum credit of $2,000 per child per year previously to $3,000 per child 6-17 per year and $3,600 per child under 6 per year; and provision for half of the loan in the form of a monthly advance between July and December 2021.
As a result of these changes, about 92% of families with children were eligible to receive $250 to $300 per month per child between July and December 2021, according to the study. National data shows that parents report spending monthly CTC payments on food, utilities, rent, clothing and education costs, according to the article.
These monthly payments expired in January 2022 after the US Congress failed to extend the policy.
In a series of surveys conducted by researchers just before the CTC expired, the unadjusted household food insufficiency was 12.7% among households with children.
In late January and early February 2022, following the first missed monthly CTC payment, 13.6% of households with children reported food insufficiency, rising to 16% in late June and early July 2022.
“Given the well-documented associations between the inability to afford food and poor health outcomes across the lifespan, Congress should consider prompt action to reinstate this policy,” the JAMA article recommended.
These latest findings mirror previous research done by the nonpartisan National Research Group at the Brookings Institution and published in April 2022 in a report titled “The Impacts of the 2021 Expanded Child Tax Credit on Family Employment, Nutrition and financial well-being”.
Brookings researchers said the temporary tax credit expansion “has unprecedented reach” and lifted 3.7 million children out of poverty by December 2021.
“The expanded CTC significantly improved food security and healthy eating among eligible people,” Brookings found.
Moreover, according to this study, about 70% of CTC recipients who were negatively affected by inflation said that the payments helped them better manage rising prices.
Besides increasing food security, other areas Brookings said tax credits help families include statistically significant declines in credit card debt compared to those who were not eligible; reducing reliance on expensive financial services such as payday loans and pawnbrokers, as well as reducing blood plasma sales rates; increased capacity to manage emergency expenses and strengthened family emergency funds; and a significant drop in evictions.
Brookings also found that credit enabled families of color to make significant investments in their children’s long-term educational outcomes. Black, Hispanic and non-white households were more likely to use the credit for child care and education expenses, Brookings found.
South Dakota Searchlight is part of States Newsroom, a grant-supported network of news outlets and a coalition of donors as a 501c(3) public charity. South Dakota Searchlight maintains editorial independence. Contact editor Seth Tupper with any questions: [email protected] Follow South Dakota Searchlight on Facebook and Twitter.
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