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Joint Economic Committee Democrats Chairman - Rep. Don Beyer (D-VA)

UPDATE: Six Months of Advance CTC Payments Have Dramatically Reduced Childhood Poverty and Improved Family Finances

Key Points:
The expanded CTC will lead to a historic reduction in childhood poverty
Parents have used advance CTC payments to help afford child care
Early advance CTC payments led to sizable declines in financial hardship and food insufficiency
The expanded CTC advances racial and geographic equity
The expanded CTC yields a high return on investment
Passing the Build Back Better Act would extend CTC advance payments for 36 million families

The expansion of the CTC, included in President Biden’s American Rescue Plan, is one of the largest-ever single-year tax cuts for families with children. It dramatically increased the value of the CTC from $2,000 per child to up to $3,600 per child under age 6 and $3,000 per child between age 6 and 17, putting money in the pockets of low- and middle-income families to pay for household expenses like food, rent, utilities and child care.

As part of the expansion, half of the CTC has been distributed in advance via monthly payments, helping families meet their financial needs in real time. Qualifying families have received monthly checks from July through December, and because the CTC was made fully refundable, previously ineligible low-income families can receive the full credit. More than 61 million children from over 36 million families have received a total of nearly $93 billion in advance Child Tax Credit payments in 2021. The average advance CTC payment per household was $444 in December.

Read the full brief here.

Read a fact sheet elevating key takeaways here.

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