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Parents Describe How They Spent Their Last Child Tax Credit

With Build Back Better stalled, the final payments went toward savings, childcare, and a few Christmas gifts.

a girl in a hat holds a barbie

On December 15, parents received direct deposits that will likely be the last of the monthly payments they’ve received as part of the enhanced child tax credit, one of the Biden administration’s signature social spending policies. The program, which started in July as part of the American Rescue Plan, was said to reach 36 million families and added up to between $3,000 and $3,600 annually per child, depending on their age. When Biden introduced the credit, he said it had the potential to reduce child poverty “in the same way Social Security reduced poverty for the elderly.” Now, with the Build Back Better Act almost certainly dead, some estimates say 10 million children will fall back into poverty as the program expires and Senator Joe Manchin blocks the entire proposal over its effect on “our rising debt.”

Publicly, Manchin suggested the cost of Build Back Better was too high; privately, he leaned on decades of anti–social welfare talking points to suggest that parents would use their payments to buy drugs. In reality, there are myriad uses for payments like these outside of staples like groceries and rent, even if Facebook groups formed to discuss the credits are littered with comments deriding parents who use the extra cash to buy gifts for their kids. Recently, I reached out to some parents of young children to ask how they were spending that last check. Interestingly, a few of them declined to be interviewed, saying that while they certainly appreciated the extra money, they didn’t feel they were struggling enough to represent an ideal source. But I’d argue that $300 a month to help care for a child—however care is defined—is an eminently reasonable sum, no matter how it’s spent, and that worrying about who deserves a few hundred bucks is a by-product of the same logic that gets us work requirements for health care or politicians who believe paid leave shouldn’t be implemented because some people might take off work to have a nice time. 

Obviously, how far these checks went depended mightily on geography and circumstance. The child tax credits could have wildly different impacts on families’ finances depending on their access to, for instance, state subsidies for childcare or a family member close by to help watch kids while a parent works. For some people I spoke to, that extra cash was a psychological comfort; for others, a necessary way to keep their kids in day care or the only way they could buy a Christmas gift. 

Dan Flynn, Maine

We have two kids, 1 and 3. Yeah, it’s crazy all the time over here. All of a sudden, we were just getting checks—600 bucks for the two, in one lump sum, direct deposit. I read the news, so I knew it was coming. It coincided pretty well with Leon, our oldest, starting at a new school. Previously he’d been at what was basically just a child warehouse, not an awesome environment. He hated it. So we switched him over. It’s sort of a hippie school. He was supposed to start in August, but because of Covid, he started in September. It’s a little bit more expensive, but the big difference is that the school doesn’t take any state subsidies for childcare. Between his school and our youngest’s daycare, every penny of that money is spoken for.

I work as an installer for a solar company. My wife works for a local land trust. Leon’s school is like $500 a month. And they just raised the cost of day care a little—it’s $160 a week at the YMCA now. We haven’t talked about what we’re going to do yet. Realistically, what do you do? We’ll have to pull Leon out of the school he’s in, or maybe we’ll be able to use the tax return money to keep him in for the rest of the year, or pray to the economy gods that inflation isn’t at like 8 percent toward the start of the next school year. If things don’t change, that’s definitely going to have to be a conversation.

In all seriousness, Build Back Better was the only bill in my memory that would have helped working families in a meaningful way. I’m thinking about mailing Joe Manchin coal for Christmas, like, “Here you go, bud.” I don’t give a fuck about infrastructure—I’ll drive down dirt roads. But right now, I’m having to make decisions about paying for my kid’s day care bill and being able to buy the groceries we need. Everyone should send Joe Manchin coal.

Tim Wong, Texas

I’m 32, and I work as a campus chaplain at the University of Texas at Austin; my wife works in fundraising. She’s 37. We have one child, 16 months old, definitely a pandemic baby. We both worked through the pandemic: My wife was full-time, I went part-time to help with the baby. When we got the news that we would qualify, we decided to get the installments so we could have a little bit of a cushion. We’re generally doing pretty good, but we thought it might be nice to save. We tried to start budgeting better over the pandemic. We had some credit card debt to pay off. Psychologically, with a new baby, the tax credit helped us feel more secure. But in terms of when we were breaking things down with our bills, it didn’t make a huge dent. We’re not going to feel the loss immediately, but right now we don’t have to pay for childcare. We’ve been lucky: My mother-in-law lives about 10 minutes away. When I went part-time, I spent two days a week with my daughter, and the other three days she was with my wife’s mother. If we both needed to work full-time, that $300 would have been much, much more felt and appreciated. And we’re already thinking about next year, with school on the horizon. That’s when it starts to get really expensive. 

Lydia Coe, Michigan

I’m 24, and I have two kids, 5 and 2. My youngest has some health issues, and I have a connective tissue condition. I’ve had two surgeries this year, and another one coming up. I’ve only been getting the child tax credit for one kid—I’ve been trying to get them to fix that; I’m assuming I’ll get some of it when I do my taxes. But even the $300 tax credit really helped a lot, because I don’t really have an income right now besides what I can sell online. That $300 is really helping with my bills. My spouse and I separated; he actually died recently, and now I have to figure out how to get down to Virginia for the funeral. My brother, who is 21, moved in last month to help me with the rent, and we’re just trying to play catch-up. It’s good to have him around, but my landlord is trying to evict me, and I have to go to housing court next month. My brother is 21 and works for Amazon as a delivery driver. He does lots of jumping in and out of his truck—he told me he had 380 packages the other day, all by himself, the most he’s ever had.

On December 15, I was finally able to get a couple of Christmas presents for my kids. Just little things, they like to do crafty things with me. Some Play-Doh, paint stuff, slime. Some nice markers for my daughter, and sensory stuff for my youngest. The rest went to rent. I’m really stressed out. It was a little money, but it was so helpful. I feel like I have so much on my plate.