The Child Tax Credit put a dent in child poverty. Now that it’s expired, child poverty is rising.

Back • Publication Date: February 18, 2022 • Fiscal & Economics

Child poverty rose nationally last month because of the end of an expanded Child Tax Credit, according to new data from the Center on Poverty and Social Policy at Columbia University.

Nearly 3.7 million more children fell under the poverty threshold in January, joining the 8.9 million children already there. At the end of 2021, the national child poverty rate was 12.1%, last month it increased to 17% – that nearly 5% increase represents the highest rate since the end of 2020, according to the data release.

Patrick O’Brien, a research and policy fellow at Connecticut Voices for Children, estimated what a 5% increase in child poverty in Connecticut means. The study didn’t break down the data by state, so O’Brien made his own estimate.

“That’s equal to about 36,000 children in Connecticut falling back into poverty,” he said, “and that would disproportionately include children of color.”

However, the report did find a greater percentage increase in poverty among Latino and Black children at the national level.

The American Rescue Plan temporarily expanded the Child Tax Credit last year to give more money to more families on a monthly basis, according to Some parents were eligible for up to $3,000 for each child between 6-17 years and $3,600 for each child under 6. Parents could have received the monthly payments between July to December 2021, and claim the remainder of their reward when filing their taxes in 2022, according to the federal website.

“A majority of families were using this to pay their usual household expenses,” O’Brien said, “but in Connecticut, half of families overall were still struggling to pay their usual household expenses.”

He said it’s important to realize the credit’s impact went beyond low-income families, but still didn’t do enough. “The poverty threshold is important but just moving from one side of the poverty threshold to another, that’s not really sufficient,” he said.

About 100,000 children are living in poverty in Connecticut, according to O’Brien, but around 600,000 children overall benefitted from the credit. “Above the poverty threshold, people are still struggling to make ends meet,” he said.

Lawmakers in Washington D.C. planned to continue the tax credit as part of President Biden’s Build Back Better bill, but talks on that legislation have mostly stalled, according to the Associated Press.

Connecticut Voices for Children is pushing for a state-specific Child Tax Credit this legislative session.

Authors: Ali Oshinskie •  Source: WNPR • View