The Washington PostDemocracy Dies in Darkness

The child tax credit payments are ending. Some families say they will struggle without them.

Lydia Coe makes lunch on Dec. 21 as her 5-year-old daughter plays on a tablet. Coe has been using the child tax credit to help support her family. (Brittany Greeson for The Washington Post)

An earlier version of this story incorrectly stated that Sen. Joe Manchin III (D-W.Va.) had offered to support a $1.8 billion version of the Build Back Better Act. He supported a $1.8 trillion version. This story has been updated.

The payment wasn’t there when she checked at midnight, so Lydia Coe was nervous as she thumbed open her bank account on her phone the morning of Dec. 15. It wouldn’t be much of a Christmas for her kids — 5 and 2 — without the money, she knew.

Luckily, there it was — $300 from the expanded child tax credit program. The monthly payments had become the only financial constant for the 24-year-old living in Mason, Mich., over the past six months, even though she only received payments for one of her two children due to a filing glitch. But every bit helped.

Besides artistic home decorations and colorful prints that she makes and sells on Etsy, Coe had no cash coming in. A painful physical condition — Ehlers-Danlos syndrome — kept her from working. But when the CTC payments started in July, the money afforded her some much needed independence as she separated from a longtime partner. Later, the money kept the car’s gas tank filled as she shuffled to weekly doctors appointments for her youngest daughter, who has her own genetic condition. Later still, the money meant she could give something each month to her landlord, even if the payments failed to cover her growing balance, and still pay for groceries despite rising costs.

“I’ve never seen so many foods rise in price until this year,” she said.

The December monthly payment, however, is likely to be the last for Coe and an estimated 36 million other families. They will still receive a refund on their next tax return, but the program’s political fate is grim. On Dec. 19, Sen. Joe Manchin III announced he would not vote for President Biden’s $2 trillion Build Back Better Act, citing concerns over the ballooning federal budget and rising consumer prices.

The West Virginia Democrat had offered to support a $1.8 trillion version of the bill containing key provisions like universal prekindergarten care and Obamacare expansion. The child tax credit, however, was missing from Manchin’s proposal. Without the senator’s green light, the provision is probably done.

Manchin’s private offer to Biden included pre-K, climate money, Obamacare — but excluded child benefit

The tax credit expansion was envisioned as a once-in-a-generation opportunity to address American poverty. If Democrats fail to revive the proposal, the program will go down as a one-time experiment in financial assistance, one in a series of cash infusions, such as the previous stimulus payments, to steady households during the coronavirus pandemic.

For millions of families, the program has helped pay for everyday items and essentials — food and gas, rides to the emergency room and child care, school clothes and holiday gifts. And the program is ending as those costs rise due to inflation. Between July, when the payments began, and November, the inflation rate rose from 5.4 percent to 6.8 percent, government data show.

“For us people that live in poverty, life is so expensive,” Coe said. “Rent is expensive, getting to work is expensive. Babysitters are expensive. It’s all so expensive when you are not making enough money.”

‘Begging for the scraps’

The expanded version of the child tax credit, which was passed as part of stimulus legislation in March, increased the maximum annual credit from $2,000 to $3,600, expanded eligibility to far more of the country’s poorest families, and enabled families to receive the funds each month, instead of in a lump sum once a year. The Treasury Department estimated that the families of more than 26 million children, who would have qualified for only a partial credit in the past because their incomes were too low, received the full expanded credit.

Advocates for its extension say the expanded version of the credit has largely gone toward basic necessities and smoothing out tight budgets.

“We see parents getting the deposits, buying food, buying clothes, buying school supplies, exactly as planned,” said Chuck Marr, senior director of federal tax policy at the Center on Budget and Policy Priorities, a left-leaning think tank. “You have fewer children across the country going to bed hungry. That’s a major achievement with historic potential if they could just continue it and make it permanent over time.”

The CBPP has estimated that maintaining the expanded version of the credit would cut child poverty by 40 percent compared with reverting to the credit’s less generous form.

Others argue that given the expanded version of the credit has hit families’ bank accounts for only six months, it’s unlikely that its disappearance would cause serious ripples in the economy.

“This is not like your Social Security check,” said Marc Goldwein, senior vice president for the nonpartisan Committee for a Responsible Federal Budget. “I don’t know what to expect but I don’t know that we should be in panic mode. It’s not like this is a long-standing benefit.”

Goldwein also criticized the Democrats’ decision to pursue an expansion of just one year, a strategy they adopted to lower the Build Back Better bill’s price tag in the face of Manchin’s opposition.

“If your concern is that it’s unfair to parents to have this kind of on-again, off-again system, then you need to come up with a more permanent solution,” he said.

In the days and weeks leading up to Manchin’s decision on Build Back Better, some of his constituents had tried to convince him of the importance of the expanded credit to West Virginian families. Last Thursday, around 10 West Virginia mothers dialed into a Zoom call to speak with two Manchin aides, and for close to 50 minutes detailed what the Build Back Better plan would mean for their lives.

Amber Roy, 42, one of the mothers on the call, works nights as a caregiver for developmentally delayed deaf patients. Her husband is disabled, and one of her children is a two-time cancer survivor. She used her December credit to buy her children one Christmas gift each, with the rest of the funds going toward an emergency veterinary bill. She felt like the Manchin aides, which included legislative director Wes Kungel, heard the mothers and took in their experiences.

A Manchin spokeswoman did not respond to a request for comment about the call.

Sen. Joe Manchin wants to restrict who gets the child tax credit. These West Virginians would be affected if he prevails.

By Sunday, Roy’s feeling had turned into a sense of betrayal. She heard the news of Manchin’s decision while working an overtime shift, one of many she has picked up in recent months to keep her family above water, regularly working 72 hours in a single week.

“We are begging, we’re begging for the scraps,” Roy said, breaking into sobs. “He will never in his life know what it looks like or what it feels like to go hungry so your children can eat. He will never know what that feels like, but those of us who do are screaming at the top of our lungs to please listen and pay attention.”

Keeping the lights on

For Tatiana Austin, 28, the tax credit money came as she was trying to adjust to a new life in a different state. From Chicago, she moved outside of Atlanta in 2019 with her three children, now 8, 6 and 2.

Before the coronavirus hit, Austin had a friend who was able to watch her children as she worked. When the pandemic upended the arrangement, Austin found herself struggling to balance work and raising her children while also meeting a monthly $1,145 payment for her rent and utilities. Besides food assistance and Medicaid, her $800 tax credit payments were all she had coming in.

“I have no other resources,” Austin said. “It has definitely helped with the bills I have and with rent and toiletries and buying clothes for the kids. I am definitely worried about keeping the lights on without it.”

Austin said she had a job interview coming up next week. But she still wondered if new employment would help much. “Not too many companies are paying too much,” she said. “Even with working, I’m going to have to pay for child care.”

Eugenia Harper, 38, is raising two children, 7 and 11, in Albany, N.Y. She previously worked as a home health aide, but concerns over exposure during the pandemic led her to cut her hours.

Her $500 monthly child tax credit payment has allowed her extra financial flexibility.

“It’s given us that extra help that we’re not able to get from friends or family,” she said. “It’s been a wonderful thing to have that extra little spurt of cash, because you never know.”

Harper was able to use the payments to travel to North Carolina in August for her 19-year-old son’s graduation from basic training in the U.S. Marine Corps. On another occasion, her 7-year-old hit her head on a 12-pound weight, and they had enough money to take an Uber to the emergency room.

Harper worries what will happen when the payments end.

“I get child support and the child tax credit, and I’ve been able to manage on that. There’s no thrills and frills,” she said. “We need this money just to survive.”

Inflation is what worries Mekeshia Sanchez, 37, a registered nurse in Sanford, Fla.

During the pandemic, while her husband worked, Sanchez was forced to take a lower-paying at-home job so she could be with the couple’s children, ages 5 and 8. The tax credit payments of $550 bridged the differences between the family’s pre- and post-pandemic income.

“It has helped us tremendously, especially with the rising cost of groceries and gas,” she said. “We just went to the grocery store and spent $250 on groceries that used to cost us about $90.”

The loss of the payments — which also helped with school clothes and extracurriculars like gymnastic classes — will mean Sanchez will have to take on more work outside the house.

“I’ll have to go out and pick up additional hours to keep them in day care. Day care is probably going to cost me $1,200.”

She continued: “I work full time. I’m a nurse. I contribute to society. But you’ve got some people that don’t, but they get Section 8 housing, medical insurance, food stamps. I can’t get any assistance like that because I’m ‘above the poverty line.’ But that $550 was actually helping me stay home with my kids.”

Doyle Franklin, 60, in Corvallis, Ore., began receiving the payments for his three children just as his family hit a rough patch. A disabled veteran, Franklin had his Supplemental Security Income payments stopped because his wife made too much money working for her grandmother last summer.

Although the family’s housing and utilities were covered from a program for veterans, the tax payments for the kids — 7, 4 and 2 — helped cover everything else.

“It helped with car repairs, groceries and when the kids needed clothing,” he said. “Kids grow faster than you think. You go spending money on clothes one week, and then the next week you’ve got to spend more money on new clothes because they’ve already outgrown stuff.”

The payments have been key with rising food and gas costs. “Hell, I feel like I made more money a month during the years Jimmy Carter was president.”

Coe ended up using the majority of her final $300 child tax credit payment on rent. “I’m at least two months behind on rent, and I just had an eviction hearing, which was pushed to January. But if I can’t come up with the rent, we’ll be out,” she said.

She kept $50 so her children, 5-year-old Alice and 2-year-old Moira, would have Christmas gifts.

“We do a lot of arts and crafts, so I got some slime and Play-Doh,” Coe said. “Having had the tax credit has been really helpful so far. Without it, I’m that much poorer, and I’m hardly getting by.”

Read more:

From charm offensive to scorched earth: How Biden’s fragile alliance with Manchin unraveled

Most parents use child tax credit on food, bills and other necessities, survey finds