Most households with kids will receive a bank deposit for the second round of the advance child tax credit on Friday. It’s a monthly deposit of up to $300 per child, depending on their age and household income.
New numbers from the U.S. Census Bureau provide a look at how families spent their deposits in July, and it turns out that many parents and families are putting that cash toward the basics.
Ask Endia Villar how she spent her $300 from the first child tax credit deposit last month? “Groceries,” she said.
Villar is a working mom in Allen, Texas, with a two-year-old daughter and a baby on the way.
“I am pregnant, and I eat like a teenage boy,” Villar said. “We needed more food. So it — it worked out perfectly.”
The census data show the top things families spent the money on were necessities, including food, clothing and utilities. That shows the child credit is working, said Natalie Foster with the nonprofit Economic Security Project.
“We know that families with children were especially stretched thin this last year. This data demonstrates that families are using their child tax credit payments, to pay their bills, to buy groceries, and to get their kids ready for school,” Foster said.
But it is a costly program. The first round of payments cost the government $15 billion, and the credit’s future is uncertain. President Joe Biden wants it to continue, funded in part through corporate tax increases. For now, the monthly deposits go through December.
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