THIRD WORLD USA
Families paying off rent, food, debts with child tax creditBy MICHAEL CASEY
AP
July 30, 2021
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NASHUA, N.H. (AP) — Christina Darling finally replaced her 2006 Chevrolet Equinox after it broke down several times while picking her children up from day care. But the 31-year-old mother of two was struggling to keep up with the car payments.
Brianne Walker desperately wanted to take her three children and two siblings camping for the first time but wasn’t sure how she could pay for it. After all, she was behind on her rent, and day care and grocery costs were adding up.
Then, the two women from New Hampshire got a surprise in their bank accounts this month. They qualified for the expanded child tax credit, part of President Joe Biden’s $1.9 trillion coronavirus relief package. Families on average are getting $423 this month; the Treasury Department estimates that 35.2 million families received payments in July.
“The additional money does help alleviate the pressure,” said Walker, 29, who took custody of her two siblings last year after her mother overdosed. The $800 credit will help make up for losses she incurred after quitting a kitchen design job to care for the five youngsters, ages 3 to 19.
Biden increased the amounts going to families and expanded it to include those whose income is so little they don’t owe taxes. The benefits begin to phase out at incomes of $75,000 for individuals, $112,500 for heads of household and $150,000 for married couples. Families with incomes up to $200,000 for individuals and $400,000 for married couples can still receive the previous $2,000 credit.
In the past, eligible families got a credit after filing their taxes — either as a lump sum payment or a credit against taxes owed. But now six months of payments are being advanced monthly through the end of the year. A recipient receives the second half when they file their taxes. The credit is $3,600 annually for children under age 6 and $3,000 for children ages 6 to 17. Eligible families will receive $300 monthly for each child under 6 and $250 per older child.
Advocates argue the monthly payments make more sense for low-income families.
“One of the problems with the big check in a year, if your car broke six months before, that is a long time to wait,” said Michael Reinke, executive director of the Nashua Soup Kitchen & Shelter, which serves many families making less than $26,000 a year.
“When people have money over a consistent period of time, it’s easier to make sure it’s going to the expenses you really need,” he said. “Sometimes, if you get it all at once, it’s hard to budget.”
Robin McKinney, co-founder and CEO of the CASH Campaign of Maryland, a Baltimore nonprofit organization that helps low-income residents file taxes, said the credit is providing people money in their pockets now, when they need it most.
“We know right now that peoples’ hours are down or they’re still struggling to get back to the same level of income that they had before, and this will create some stability for those families to know that over the next six months that they’re going to be getting this payment,” McKinney said.
If all the money goes out, the expectation is that could significantly reduce poverty — with one study estimating it could cut child poverty by 45%. And it comes at a time when unemployment benefits are being phased out and the federal eviction moratorium is set to expire Saturday.
The payments are also a test case of sorts. Biden ultimately would like to make them permanent — and the impact they have could go a long way to shaping that debate later this year.
Brianne Epps of Jackson, Miss., 28, background, is a single mother with sons Micah Epps, 4, in front, and Nolan Epps, 11 months in her arms and daughters Laila Barnes, 6, second from left, and Kaylee Barnes, 8, center, outside her apartment complex in Jackson, Miss., Wednesday, July 21, 2021. Epps earns $9 an hour working with infants and toddlers in a childcare center, but she has a bigger dream of operating a soul food catering business. (AP Photo/Rogelio V. Solis)
“It infuses money into the family home,” said Suzanne Torregano, director of Family Services at Kingsley House in New Orleans, who estimated that 85%-90% of the parents the group serves are getting the monthly payments.
Still, some advocates argue the money may never reach the neediest because their incomes are so low they aren’t required to file a tax return, they don’t have a fixed address or bank account, or don’t have the internet savvy to apply.
“What we are finding is that homeless families … while many of them are eligible for the tax credit, they have significant barriers to obtaining it,” said Larry Seamans, president of FamilyAid Boston, which serves 900 families daily.
“We have some counter-intuitive struggles of families who may be unfamiliar with tax forms, tax laws and the fact that by filing a tax return, you can actually get money to support your family,” Seamans said.
“Many families ... are not on the tax rolls. They now have to find sufficient documentation to prove that they are eligible.”
Families who do receive the credit are mostly spending it on rent, child care and groceries, as well as catching up on cellphone and other bills. For Darling, the $550 she gets will go to car payments, more fresh produce and a babysitter so she can attend Nashua Board of Education meetings. She is running for a seat on the board. Eventually, she hopes to put money aside to save for a home with a yard.
“Every step closer we get to a livable wage is beneficial. That is money that gets turned around and spent on the betterment of my kids and myself,” said Darling, a housing resource coordinator who had been supplementing her $35,000-a-year salary with monthly visits to the Nashua Soup Kitchen and Shelter’s food pantry.
McKinney, who is married with a 5-year-old son and qualifies for the tax credit, is getting $167 a month. She said it’s all going to help pay for child care, which costs $288 a week.
“Right now, it’s out-of-school time because it’s the summer, so people have to pay for camps and babysitting support so that the parents can go to work,” said McKinney, of Columbia, Maryland. “I know a lot of people who are like: ‘This money is coming at just the right time, because this summer is more expensive for me for child care.’”
Many families in higher-income brackets who receive less money are socking it away for things like a family trip, school supplies or Christmas gifts.
Carleigh Steele, who received several hundred dollars, said the money is giving her peace of mind a month after she moved into a house in Baltimore with the help of Habitat for Humanity.
“It’s sitting in my bank account for all the home-buying things that I need, and for the rainy day fund for my house — just to make sure that I can keep myself economically stable,” said Steele, who has a 6-year-old daughter.
Brianne Epps, a mother of four from Jackson, Mississippi, is using the money to pay bills but also to finance her dream of opening a soul food catering business. “It will help me, for one, to promote my catering business — to get that off the ground,” she said.
Molly Vigeant, of East Hartford, Connecticut, a 25-year-old single mother who works as a special needs paraprofessional in a high school, hopes to spend the money to repair or replace her car. But she’s had trouble accessing a portal aimed at helping applicants and hasn’t yet received anything.
“It doesn’t hurt yet,” she said of the delayed payment. “But, it’s a 20-year-old car with over 200,000 miles on it and I make 20 grand a year. A new one is not going to fall from the sky, when your debt-to-income ratio is garbage and you know you can’t finance a car.”
___
Associated Press writers Brian Witte in Annapolis, Maryland; Rebecca Santana in New Orleans; Emily Wagster Pettus in Jackson, Mississippi, and Pat Eaton-Robb in Columbia, Connecticut, contributed to this report.
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In this July 28, 2021 photo, Christina Darling plays with her sons Kayden, 10, left, and Brennan, 4, at home in Nashua, N.H. Darling and her family have qualified for the expanded child tax credit, part of President Joe Biden's $1.9 trillion coronavirus relief package. "Every step closer we get to a livable wage is beneficial. That is money that gets turned around and spent on the betterment of my kids and myself," said Darling, a housing resource coordinator who had been supplementing her $35,000-a-year salary with monthly visits to the Nashua Soup Kitchen and Shelter's food pantry. (AP Photo/Elise Amendola)
Brianne Walker desperately wanted to take her three children and two siblings camping for the first time but wasn’t sure how she could pay for it. After all, she was behind on her rent, and day care and grocery costs were adding up.
Then, the two women from New Hampshire got a surprise in their bank accounts this month. They qualified for the expanded child tax credit, part of President Joe Biden’s $1.9 trillion coronavirus relief package. Families on average are getting $423 this month; the Treasury Department estimates that 35.2 million families received payments in July.
“The additional money does help alleviate the pressure,” said Walker, 29, who took custody of her two siblings last year after her mother overdosed. The $800 credit will help make up for losses she incurred after quitting a kitchen design job to care for the five youngsters, ages 3 to 19.
Biden increased the amounts going to families and expanded it to include those whose income is so little they don’t owe taxes. The benefits begin to phase out at incomes of $75,000 for individuals, $112,500 for heads of household and $150,000 for married couples. Families with incomes up to $200,000 for individuals and $400,000 for married couples can still receive the previous $2,000 credit.
In the past, eligible families got a credit after filing their taxes — either as a lump sum payment or a credit against taxes owed. But now six months of payments are being advanced monthly through the end of the year. A recipient receives the second half when they file their taxes. The credit is $3,600 annually for children under age 6 and $3,000 for children ages 6 to 17. Eligible families will receive $300 monthly for each child under 6 and $250 per older child.
Advocates argue the monthly payments make more sense for low-income families.
“One of the problems with the big check in a year, if your car broke six months before, that is a long time to wait,” said Michael Reinke, executive director of the Nashua Soup Kitchen & Shelter, which serves many families making less than $26,000 a year.
“When people have money over a consistent period of time, it’s easier to make sure it’s going to the expenses you really need,” he said. “Sometimes, if you get it all at once, it’s hard to budget.”
Robin McKinney, co-founder and CEO of the CASH Campaign of Maryland, a Baltimore nonprofit organization that helps low-income residents file taxes, said the credit is providing people money in their pockets now, when they need it most.
“We know right now that peoples’ hours are down or they’re still struggling to get back to the same level of income that they had before, and this will create some stability for those families to know that over the next six months that they’re going to be getting this payment,” McKinney said.
If all the money goes out, the expectation is that could significantly reduce poverty — with one study estimating it could cut child poverty by 45%. And it comes at a time when unemployment benefits are being phased out and the federal eviction moratorium is set to expire Saturday.
The payments are also a test case of sorts. Biden ultimately would like to make them permanent — and the impact they have could go a long way to shaping that debate later this year.
Brianne Epps of Jackson, Miss., 28, background, is a single mother with sons Micah Epps, 4, in front, and Nolan Epps, 11 months in her arms and daughters Laila Barnes, 6, second from left, and Kaylee Barnes, 8, center, outside her apartment complex in Jackson, Miss., Wednesday, July 21, 2021. Epps earns $9 an hour working with infants and toddlers in a childcare center, but she has a bigger dream of operating a soul food catering business. (AP Photo/Rogelio V. Solis)
“It infuses money into the family home,” said Suzanne Torregano, director of Family Services at Kingsley House in New Orleans, who estimated that 85%-90% of the parents the group serves are getting the monthly payments.
Still, some advocates argue the money may never reach the neediest because their incomes are so low they aren’t required to file a tax return, they don’t have a fixed address or bank account, or don’t have the internet savvy to apply.
“What we are finding is that homeless families … while many of them are eligible for the tax credit, they have significant barriers to obtaining it,” said Larry Seamans, president of FamilyAid Boston, which serves 900 families daily.
“We have some counter-intuitive struggles of families who may be unfamiliar with tax forms, tax laws and the fact that by filing a tax return, you can actually get money to support your family,” Seamans said.
“Many families ... are not on the tax rolls. They now have to find sufficient documentation to prove that they are eligible.”
Families who do receive the credit are mostly spending it on rent, child care and groceries, as well as catching up on cellphone and other bills. For Darling, the $550 she gets will go to car payments, more fresh produce and a babysitter so she can attend Nashua Board of Education meetings. She is running for a seat on the board. Eventually, she hopes to put money aside to save for a home with a yard.
“Every step closer we get to a livable wage is beneficial. That is money that gets turned around and spent on the betterment of my kids and myself,” said Darling, a housing resource coordinator who had been supplementing her $35,000-a-year salary with monthly visits to the Nashua Soup Kitchen and Shelter’s food pantry.
McKinney, who is married with a 5-year-old son and qualifies for the tax credit, is getting $167 a month. She said it’s all going to help pay for child care, which costs $288 a week.
“Right now, it’s out-of-school time because it’s the summer, so people have to pay for camps and babysitting support so that the parents can go to work,” said McKinney, of Columbia, Maryland. “I know a lot of people who are like: ‘This money is coming at just the right time, because this summer is more expensive for me for child care.’”
Many families in higher-income brackets who receive less money are socking it away for things like a family trip, school supplies or Christmas gifts.
Carleigh Steele, who received several hundred dollars, said the money is giving her peace of mind a month after she moved into a house in Baltimore with the help of Habitat for Humanity.
“It’s sitting in my bank account for all the home-buying things that I need, and for the rainy day fund for my house — just to make sure that I can keep myself economically stable,” said Steele, who has a 6-year-old daughter.
Brianne Epps, a mother of four from Jackson, Mississippi, is using the money to pay bills but also to finance her dream of opening a soul food catering business. “It will help me, for one, to promote my catering business — to get that off the ground,” she said.
Molly Vigeant, of East Hartford, Connecticut, a 25-year-old single mother who works as a special needs paraprofessional in a high school, hopes to spend the money to repair or replace her car. But she’s had trouble accessing a portal aimed at helping applicants and hasn’t yet received anything.
“It doesn’t hurt yet,” she said of the delayed payment. “But, it’s a 20-year-old car with over 200,000 miles on it and I make 20 grand a year. A new one is not going to fall from the sky, when your debt-to-income ratio is garbage and you know you can’t finance a car.”
___
Associated Press writers Brian Witte in Annapolis, Maryland; Rebecca Santana in New Orleans; Emily Wagster Pettus in Jackson, Mississippi, and Pat Eaton-Robb in Columbia, Connecticut, contributed to this report.
Families pay for rent, food with child tax credit
TRANSCRIPT
Brentwood, New Hampshire – 23 July 20211. Tracking shot of Brianne Walker, who is raising three children and including two siblings, interacting with her daughter at a day care center
STORYLINE:
Families are starting to spend money from the expanded child tax credit.
Many say they are using the money to pay rent, supplement their grocery budget and for catching up on bills, including cellphone and car payments.
Beneficiaries include Brianne Walker, who is raising five children on her own – including two siblings in her legal custody.
She says she used her first check to make a late rent payment.
She also plans to take the children camping, hoping to create their first memorable experience of the summer season.
The 29-year-old Walker was forced to quit a home-designing job in Maine when she got custody of her siblings at the beginning of the pandemic.
She now works part time at a body shop because caring for five children on her own does not give her enough time or flexibility to take on a full-time job.
Still, she hopes to save some of the child tax credits for down payment for a family home that will eventually allow her to sleep in a bedroom, instead of her current sleeping arrangement in the living room.
President Joe Biden increased the amounts going to families and expanded it to include those whose income is so little that they don't owe taxes.
The benefits begin to phase out at incomes of $75,000 for individuals, $112,500 for heads of household and $150,000 for married couples. Higher-income families with incomes up to $200,000 for individuals and $400,000 for married couples can still receive the previous $2,000 credit.
SOUNDBITE (English) Brianne Walker, Raises Five Children:"About two weeks ago, I had received the initial Child Tax Credit payment. I received $250 for my 13-year-old brother, is that what it is, and then $300 for my 3-year-old daughter. That was immediately deposited into my bank account federally because that's who I claim on my taxes. It was great. I immediately paid my rent, which was late. So that covered for the remaining portion of my rent this month."3. Brianne Walker watchers her daughter and other children play at the day care center4. Brianne Walker interacts with her daughter at the entrance of the day care center
SOUNDBITE (English) Brianne Walker, Raises Five Children:"When they're gonna give me Child Tax Credits and they say this is for your children, it's going right back into the economy where my children reside. So it's it's going back into the daycare, it's going into the food, it's going to the grocery store. It's going into the camp trip that we're gonna take. We've never been real-tent camping. So my children are gonna go real-tent camping and that was, you know, at a state park."6. Brianne Walker interacts with her daughter in the playground of the day care center
SOUNDBITE (English) Brianne Walker, Raises Five Children:"So any time any extra money comes in, that covers my tax, my car payment as well to help me be able to get to and from work, to get me to and from daycare, to get my children to and from dentist appointments."8. Brianne Walker with her daughter at the entrance of the day care center
SOUNDBITE (English) Brianne Walker, Raises Five Children:"The Child Tax Credits, within the next few months, will be turned into savings. As long as everything continues to go well, the it will be turned into savings for the house so that we can put a down payment on the house – and that's something that's for my children, my entire family."10. Jennifer Briggs-Legere, director of A Place To Grow day care center, joins children searching for worms and other creatures in the play ground
SOUNDBITE (English) Jennifer Briggs-Legere, Director, A Place To Grow Child Care Center:"I think the child care tax credit, providing that on a month-to-month basis, provides those families that are struggling with the opportunity to be more successful in, you know, paying their bills and they're not feeling quite so like they're living on the edge as much as they had been. So it's really beneficial if you were on that poverty line or you were on that line of struggling."12. Jennifer Legere interacts with children in her child care center
SOUNDBITE (English) Jennifer Briggs-Legere, Director, A Place To Grow Child Care Center:"About 20% of our client base receives child care scholarship. Rockingham County is one of the most expensive counties to live in in southern New Hampshire. So we see a split in what the needs economically are of our families. Those who are on child care scholarship really are benefiting from the monthly tax credit coming to them. Those funds are getting used primarily for child care based on what our parents are reporting, food on the table, money towards their rent and their mortgage. Rents are extremely high around here."14. Children returning to the child care center building from the playground
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