As the second advance child tax credit (CTC) payment is set to hit bank accounts Friday, the U.S. Census Bureau finds that July's CTC deposit likely led to a drop in the number of families experiencing food insecurity across the country.
The Census Bureau's Household Pulse Survey, which collected data before and after the first CTC deposit, found that July's payment coincided with a 3% drop in households with children experiencing food insufficiency. There was no drop reported in adult households without children.
Significantly, lower income families showed an even greater drop in food scarcity: The share of families with kids earning less than $50,000 who didn't have enough to eat fell to 18.5% from 26%.
Almost half of households receiving the CTC, 47%, reported that they spent some of the extra money on food. Other top spending categories included clothing and utility payments. Many families saved some of the payment, with 32% of families reporting that they put some money away, and paid off debt, with 40% of families reporting some of their CTC payment went to that.
The enhanced CTC is part of the American Rescue Plan, signed into law in March. Around 35 million families received the payment last month, according to the IRS, and the advance payments will continue each month through December.
They are worth up to $300 for each child age 5 and under, and up to $250 for each child 6 to 17. The average payment in July was $423. All families with children are eligible for the payments, regardless of if they normally file taxes or not.
Sign up now: Get smarter about your money and career with our weekly newsletter
- Why some divorced parents may want to opt out of the advance child tax credit
- The first advance child tax credit arrives this month. Here's everything you need to know
Source: Read Full Article