IN-DEPTH REPORT

FEBRUARY 25, 2022

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“I honestly don’t know how I am going to get by”: Parents are grappling with the loss of the monthly Child Tax Credit

Low-income families are starting the new year in a desperate position. The monthly Child Tax Credit payments families had been receiving since July ended in December 2021, after the Build Back Better Bill stalled in Congress. And while the Child Tax Credit payments were being distributed, other benefits were declining dramatically. Since July 2021, the percentage of Providers users receiving unemployment assistance declined by 87%. States across the country, including Florida and Missouri, have ended all or some emergency SNAP (Supplemental Nutrition Assistance Program or “food stamps”) benefits. In addition, only 36% of Providers users–compared to 53% in August 2021– are currently receiving P-EBT (Pandemic-EBT), a program designed to replace free and reduced price school meals during the pandemic but that has become a lifeline for many families. 


Here’s what we’ve heard from Providers users with children at the start of 2022.

Increasing costs and diminishing aid means families are struggling to put food on the table

How are you planning this month’s budget knowing you will not receive a Child Tax Credit payment this month?

Well I’m going to cut out on certain meals
- Manuela, Texas

“It's kind of back to the basic life of struggling now,“ said Andrea*, a mother of 3 in Pennsylvania, at the end of January. She received the Child Tax Credit monthly payments until December, and is now struggling to buy enough food for her husband and 6, 5, and 1 year old. “I spent like $400 [on food] and it still wasn't enough. I got a little bit for breakfast and some for dinner. But nothing for lunch. It was rocky. I googled it. I could send you the link. I looked up what is the requirement for a family of 5 to eat per month…It’s $1,000. $1,000 vs $400.” She last received P-EBT in the summer, and though Pennsylvania has approved P-EBT for the 2021-2022 school year, it has not yet released a timeline for making those payments. Andrea and her husband both work, switching off so someone is always home with the kids, who now go to a 100% virtual school.

“I knew they wouldn't pass the bill in time for them to continue it. I didn't get my hopes up,” says Andrea of the Child Tax Credit monthly payments. But “my kids weren't expecting it. I used to be like ‘what do you want to eat today?’ They would want a pizza and we would order. Now they ask mommy I want a pizza and I tell them that we don’t have money. That's how it was on Christmas. I had to see what I was going to spend on food and what Santa was gonna bring. I don't like the holidays anymore. But the kids were happy, so I was happy.”

Unfortunately, Andrea is not alone. In January, 65% of Providers users with children under 18 spent $100 or more on food beyond SNAP, P-EBT or other government benefits, and 87% said that their same basic monthly food purchases cost more than they did a year ago.

Among users with children under 18, 36% reported eating less, 26% reported skipping meals, and 19% reported relying on others for meals in January.

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Rising bills and less income are leading families to extreme measures

How are you planning this month’s budget knowing you will not receive a Child Tax Credit payment this month?

I don’t know how i will pay my bills im in a lot of debt with my utilities, internet, phone, and car loan.
- Maria, Nebraska

Holly*, a mother of four in Michigan, had been using the Child Tax Credit payments to get caught up on the bills that had piled up during the pandemic. “I made quite a bit of progress. I still have a little bit to go,” she says. But January has already brought new challenges–”My water heater decided to have issues. My van has issues. [It’s] one step forward, ten steps back.” While she received the Child Tax Credit payments, she and her husband “weren’t so stressed. We weren't afraid of things getting shut off.”

This month, she decided to pay her heating bill over her car insurance. In anticipation of the high heating bills that would come with the colder weather, Holly began donating plasma. She’s only allowed to donate twice a week but has already been 6 times since December. She usually gets $45 a donation. She hasn’t been able to work recently as the whole family got COVID-19 earlier in the month.

While many families may have put the Child Tax Credit monthly payments towards bills, like Holly, many still owe on their utilities and other bills. Nearly three quarters of Providers users with children under 18 owe on their utilities or other bills, and 43% of Providers users did not pay the full amount on their utilities in January. And like Holly, 31% of Providers users with children missed work due to illness in January, a 48% increase from December. So families are experiencing a decline in income–from the Child Tax Credit payments and from work–at the same time as high winter utility bills and higher prices are hitting.

Tax season provides some relief

Is there anything you are looking forward to in the new year?

Filing taxes for the first time in 9 years, paying off some of my debt, continuing on at my job, hopefully re-enrolling in college.
- Brandi, IL

Gwendolyn*, a single mother to a 19, 16, and 8 year old in Georgia, had planned to save part of her Child Tax Credit payments on saving for a family vacation or to send her youngest daughter to a summer camp. But in November she found out that she would be laid off from her call center job. She’s been working late and trying to keep her call quality ratings up in the hopes of getting offered another position at the same company. Looking ahead to the next few months, she feels pretty financially insecure. “Well, it's been said that you should at least have two times the amount of rent that you pay in the bank and the savings. So it's like. No, I don't even have close to that. None of that.”

Gwendolyn plans to get a tax refund advance when she files taxes to receive the second half of the Child Tax Credit, which she’ll receive with the rest of her tax refund. She needs the money to pay back a title loan she took out on her car last summer while she was unemployed. Many families are relying on tax refund advances–15% of Providers users with children under 18 have reported taking out a refund advance, a rate 25% higher than the rest of our users.

Reflecting on the past six months of Child Tax Credit payments, Gwendolyn’s perception of what kind of support the federal government can provide has changed. “I think that they could help more if they wanted to. Now that I know they have the ability to help…It's truly up to them.”

* Name has been changed

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