On the one-year anniversary of the American Rescue Plan becoming law, new state-level data released by the Economic Security Project highlights how nearly 100,000 New Jersey children were likely pushed into poverty when the expanded Child Tax Credit expired.
One of the American Rescue Plan’s most successful programs, the expanded Child Tax Credit slashed child poverty in the United States and infused local economies with tens of billions of dollars in additional spending during an unprecedented public health crisis.
When CTC checks started hitting bank accounts in 2021, the life-changing impact of the credit was clear right away. In six weeks, food insufficiency had dropped by nearly one-third. Improvements were significant among Black and Latinx families, who experience the highest rates of food hardship.
- In the midst of an historic public health and economic crisis, CTC payments defied gravity and lowered child poverty in New Jersey.
- In New Jersey, 1,621,000 children received the expanded monthly Child Tax Credit, an average of $418 per family.
- CTC payments kept nearly 4 million kids out of poverty each month the payments went out. New Jersey stands to see a large increase in the child poverty rate with the expiration of the American Rescue Plan. Under the expanded CTC, the ARPA lifted 97,000 children out of poverty in New Jersey, reducing poverty by 8 percent.
- Monthly CTC payments have broader economic impacts, putting millions of dollars into state economies that support family incomes, job growth, and local businesses.
- Unless Congress acts to reinstate the expanded Child Tax Credit, New Jersey stands to lose $514,848,000 in additional economic activity each month.
- Beyond poverty reduction, monthly payments helped families in other valuable ways, including:
- Meeting basic needs, staying housed, and feeding their children.
- Reducing stress.
- Relying less on payday loans.
- Returning to or staying at work.
The Child Tax Credit is one of the most effective anti-poverty programs in American history. Unless Congress acts to make it a permanent part of American life, New Jersey’s children are at risk of losing access to life-changing benefits, and the whole country will take a step away from working families who, now more than ever, deserve governmental assistance. To learn more about how New Jersey lawmakers can enact a state-level Child Tax Credit, read NJPP’s February 2022 report, Making New Jersey More Affordable for Families: The Case for a State-Level Child Tax Credit.