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What We Learned from the 2021 Child Tax Credit Expansion

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  • Timothy M. Smeeding

Abstract

The 2021 expansion of the Child Tax Credit (CTC) greatly increased the amount of financial support that families received from the credit and guaranteed the fully refundable benefit to all lower-income families with children, while continuing to pay half of the annual benefits monthly. Child poverty fell to its lowest level ever (5.2 percent) after the expansion but returned to its pre-pandemic level (12.4 percent) in 2022 upon the expansion’s elimination. Notwithstanding the fact that a number of research questions about the exact effects of the 2021 expansion are yet to be answered, the articles in this volume present a strong case for a continued economic and social investment in the form of a longer-term child allowance. This summary discusses a number of key design issues for policies that aim to reduce child poverty, and I argue for research that can further substantiate the effects of a fully refundable CTC.

Suggested Citation

  • Timothy M. Smeeding, 2023. "What We Learned from the 2021 Child Tax Credit Expansion," The ANNALS of the American Academy of Political and Social Science, , vol. 710(1), pages 229-244, November.
    • Handle: RePEc:sae:anname:v:710:y:2023:i:1:p:229-244
    DOI: 10.1177/00027162241272320
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    References listed on IDEAS

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    1. Parolin, Zachary & Filauro, Stefano, 2022. "The United States’ Record-Low Child Poverty Rate in International and Historical Perspective," OSF Preprints su2fm, Center for Open Science.
    2. Jacob Bastian, 2024. "How Would a Permanent 2021 Child Tax Credit Expansion Affect Poverty and Employment?," National Tax Journal, University of Chicago Press, vol. 77(2), pages 263-311.
    3. Diane Whitmore Schanzenbach & Michael R. Strain, 2023. "Employment and Labor Supply Responses to the Child Tax Credit Expansion: Theory and Evidence," The ANNALS of the American Academy of Political and Social Science, , vol. 710(1), pages 141-156, November.
    4. Jeehoon Han & Bruce D. Meyer & James X. Sullivan, 2022. "Real-Time Poverty, Material Well-Being, and the Child Tax Credit," National Tax Journal, University of Chicago Press, vol. 75(4), pages 817-846.
    5. Garfinkel, Irwin & Sariscsany, Laurel & Ananat, Elizabeth & Collyer, Sophie & Hartley, Robert P. & Wang, Buyi & Wimer, Christopher, 2022. "The Benefits and Costs of a Child Allowance," Journal of Benefit-Cost Analysis, Cambridge University Press, vol. 13(3), pages 335-362, October.
    6. Irwin Garfinkel & Laurel Sariscsany & Elizabeth Ananat & Sophie M. Collyer & Robert Paul Hartley & Buyi Wang & Christopher Wimer, 2022. "The Benefits and Costs of a U.S. Child Allowance," NBER Working Papers 29854, National Bureau of Economic Research, Inc.
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