The Truss family makes enough money to get by, but with rising prices, one child in high school and another in college, finances can get a little tight.
“It’s just been kind of hard,” Alana Truss, the family matriarch, said from their rented home in northwest Las Vegas.
Any extra income helps, so a $250 monthly advance on the federal government’s child tax credit has been a welcome boost to the family budget.
The COVID-related American Rescue Plan expanded the credit from $2,000 per child to up to $3,600 for most parents.
The monthly checks, which started going out in July and will continue at least through the end of the year, are available to families who didn’t opt out of the advance payments.
U.S. Sen. Jacky Rosen, D-Nev., called the expanded and advance tax credit a “lifeline of support,” while Sen. Catherine Cortez Masto, D-Nev., said it would “make an enormous difference to countless working families.”
In August, the federal government sent out more than $154 million to families in Nevada, with about 594,000 eligible children.
Families received an average payment of $425, according to the U.S. Treasury.
President Joe Biden wants to reform the tax code through the proposed $1.8 trillion American Families Plan to provide the extra funds for “years and years to come,” according to the White House.
“For a working family with two kids, the increased credit could put more than $500 a month in their pockets to help make ends meet, which is why we must make it permanent,” Cortez Masto said in a statement.
The monthly payments are tax free, but according to the Kiplinger newsletter still can affect next year’s tax bill or tax refund, though.
Since they represent advance payments of the child tax credit, the funds disbursed will be subtracted from the credit amount a family would otherwise be allowed to claim on its 2021 return. That will make their 2021 child tax credit smaller, which means either the family’s tax bill will be higher or its tax refund will be smaller.
Truss said she and her husband, Willie, both make “fairly decent money.” She works in a hospital system’s financial department, and he is a government employee.
“The economy has just gotten progressively harder to raise a family,” Alana said.
The monthly $250 the couple get for their son, Isaiah, 14, has helped with rent, groceries, gasoline and other “little expenses.” Alana said.
“Just having that extra money helps out,” she said.
Their daughter, 19-year-old Kiana, who is studying communications at Northern Arizona University, works to pay her rent because loans and financial aid only cover her tuition, Alana said.
“I just can’t stress enough how important it is that we all get the help,” Alana said. “I know that (the child tax credits are) just for families with children, but if there could be something like that for everybody, that would be beneficial for the whole country.”
The nonprofit group Humanity Forward, along with Washington University in St. Louis, Appalachian State University and the University of North Carolina, Greensboro, surveyed more than 1,500 households to find out how they have used the advance child tax credit.
About 75% used the money to save for emergencies; nearly 70% spent it on housing, food and utilities; about 60% for child essentials; roughly half to buy better-quality foods; and about 40% to contribute to a college fund, according to the study.
Some 72% of recipients said they preferred the monthly installments rather than an annual lump sum after filing their taxes, the study determined.
“Monthly installments allow and encourage families to budget and utilize the credit for critical family expenses, unlike annual lump sum payments, which are more likely to be spent on luxury purchases,” the study said.