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The Child Tax Credit and Family Well-Being: An Overview of Reforms and Impacts

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  • Sophie Collyer
  • Megan A. Curran
  • Irwin Garfinkel
  • David Harris
  • Zachary Parolin
  • Jane Waldfogel
  • Christopher Wimer

Abstract

The Child Tax Credit (CTC) has become an increasingly important element of the U.S. safety net. We discuss the structure of the CTC and its effects on childhood poverty and other indicators of well-being during its three distinct phases: prior to the 2021 American Rescue Plan (ARP) expansion, during the expansion, and after the expansion’s expiration. We also examine recent efforts to establish state-level CTCs. We show that, in 2020, roughly one in three children were ineligible for the full CTC because it is tied to family earnings. The temporary expansion under the ARP extended full CTC eligibility to nearly all of these children, thus moving more than three million children out of poverty in the expansion months. State-level analyses show how states could establish CTCs that reduce child poverty rates by half, either as a complement to an expanded federal CTC or in the absence of a continued federal expansion.

Suggested Citation

  • Sophie Collyer & Megan A. Curran & Irwin Garfinkel & David Harris & Zachary Parolin & Jane Waldfogel & Christopher Wimer, 2023. "The Child Tax Credit and Family Well-Being: An Overview of Reforms and Impacts," The ANNALS of the American Academy of Political and Social Science, , vol. 706(1), pages 224-255, March.
    • Handle: RePEc:sae:anname:v:706:y:2023:i:1:p:224-255
    DOI: 10.1177/00027162231205148
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    References listed on IDEAS

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    1. Zachary Parolin & Megan Curran & Jordan Matsudaira & Jane Waldfogel & Christopher Wimer, 2022. "Estimating Monthly Poverty Rates in the United States," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 41(4), pages 1177-1203, September.
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    4. Anna Aizer & Shari Eli & Joseph Ferrie & Adriana Lleras-Muney, 2016. "The Long-Run Impact of Cash Transfers to Poor Families," American Economic Review, American Economic Association, vol. 106(4), pages 935-971, April.
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    6. Douglas Almond & Hilary W. Hoynes & Diane Whitmore Schanzenbach, 2011. "Inside the War on Poverty: The Impact of Food Stamps on Birth Outcomes," The Review of Economics and Statistics, MIT Press, vol. 93(2), pages 387-403, May.
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    9. Zachary Parolin & Sophie Collyer & Megan Curran, 2022. "Absence of Monthly Child Tax Credit Leads to 3.7 Million More Children in Poverty in January 2022," Poverty and Social Policy Brief 20417, Center on Poverty and Social Policy, Columbia University.
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