Utah receiving the highest average payments of Biden's child tax credit

President Joe Biden signs the American Rescue Plan inside the Oval Office at the White House in Washington on March 11. A one-year expansion of the U.S. child tax credit, touted by Biden, has disproportionately benefited states that voted for former President Donald Trump in 2020, a review finds.

President Joe Biden signs the American Rescue Plan inside the Oval Office at the White House in Washington on March 11. A one-year expansion of the U.S. child tax credit, touted by Biden, has disproportionately benefited states that voted for former President Donald Trump in 2020, a review finds. (Tom Brenner, Reuters)



Estimated read time: 6-7 minutes

WASHINGTON — A one-year expansion of the U.S. child tax credit, a policy championed by President Joe Biden and his fellow Democrats over Republican opposition, has disproportionately benefited states that voted for former President Donald Trump in 2020, according to a Reuters review of Treasury Department data.

And Utah, the nation's youngest state home to large families, averaged the highest monthly payment of all at $515.

But there's more than political affiliation at play, noted demographer Emily Harris. Four of the top 10 states by average monthly payments claim the nation's highest fertility rates — the number of births per woman of child-bearing age. South and North Dakota top the list, trailed by Utah and Nebraska.

"A lot of these states that have higher payments, yes, a lot of them are Republican, but a lot of them also have higher fertility rates and higher births than a lot of other places," said Harris, a senior demographer at the University of Utah's Kem C. Gardner Policy Institute. "If you're going to have more kids, you're going to have a higher average monthly payment."

When raw numbers are considered, Utah welcomes more newborns than the Dakotas, a factor that could explain the higher average payout to Utah families, Harris said.

Congressional Democrats are now seeking to extend the expansion for four additional years as part of $3.5 trillion social spending legislation opposed by Trump's fellow Republicans. The one-year expansion — part of COVID-19 pandemic relief legislation signed by Biden in March, is expected to funnel $105 billion to American families, many still hurting from the economic effects of the public health crisis.

But the financial boost is also helping those who have kept their jobs, something Harris experienced on a personal level.

"I have an 18-month-old at home, and I saw an extra $300 to put towards child care," she said. "It's just amazing."

The current expanded tax credit has proven popular nationally, a Reuters/Ipsos poll found, supported by 59% of U.S. adults including 75% of people who identified themselves as Democrats and 41% of people who identified as Republicans. The poll was conducted online Sept. 9-10, based on responses from 1,003 adults and with a credibility interval of 4 percentage points.

The policy's support among Republicans far outstripped their 11% backing for Biden's overall job performance in a separate Reuters/Ipsos poll.

Utah's median age of 31.3 is the nation's youngest, according to 2020 census figures. And while it's still home to large families, those demographics are shifting.

Births in the Beehive State have dipped in the last decade, in line with a national trend. But Harris and fellow population experts have chronicled a more pronounced drop in the last four years: Births plunged from about 49,500 to 46,500, down from 52,900 in 2010. The trend has coincided with stagnating wages and soaring mortgage payments, rent and child care costs, along with lingering student debt. Now, Utahns are waiting longer to become parents, she said.

"When you have these all these extra costs, I think people are looking at having a kid and trying to decide if they can honestly afford to have a kid — and if they have one kid today, afford to have two?" Harris said.

But it's not all doom and gloom. Women in Utah are spending more time in college — obtaining bachelor and master's degrees at higher rates — and many are serving missions for The Church of Jesus Christ of Latter-day Saints before returning to the state and starting families. Additionally, the state has fewer teen mothers than in the past.

"There are good things that are happening that are kind of creating more equilibrium with our fertility rate, how I see it," Harris said. "The main thing is we just want to make sure, right, that if people want to have kids, they're able to have kids."

The popularity of the tax credits, experts said, might benefit Democrats in elections next year that will determine whether they retain control of Congress for the second half of Biden's term. Democrats are defending razor-thin majorities in the Senate and House of Representatives.

"That could make a difference in a whole lot of places where we have close Senate and House races," said Norman Ornstein, an expert on elections at the American Enterprise Institute.

The top 10 states by average monthly child tax credit payments in August — all from the West and Midwest — were: Utah, Idaho, South Dakota, Alaska, Nebraska, Wyoming, North Dakota, Iowa, Kansas and Montana, with monthly payments ranging from $515 to $456 in August. All voted last year for Trump over Biden and all but Kansas have Republican governors.

Of the 10 states with the lowest average payments, only one — Florida — backed Trump, also having a Republican governor. Massachusetts residents received the smallest average household payment in August: $387.

Utah is among the top 10 states receiving the highest average of child tax credit payments in August. A one-year expansion of the U.S. child tax credit is being touted by Pres. Joe Biden.
Utah is among the top 10 states receiving the highest average of child tax credit payments in August. A one-year expansion of the U.S. child tax credit is being touted by Pres. Joe Biden. (Photo: Reuters)

In Wisconsin and Arizona — states that Biden narrowly won last year and are shaping up to have competitive Senate races next year — average payments in August were just under $450.

The policy gets cash to families even before they square annual tax bills. Republican-led states tend to have lower household incomes than states with Democratic leadership such as California and New York, thus benefiting more from the policy, which reduces tax credits to upper-income households.

American Rescue Plan

The economic stimulus law, called the American Rescue Plan, raised the existing child tax credit from $2,000 per child to $3,000 per child for children over age 6 and from $2,000 to $3,600 for children under age 6, while upping the age limit from 16 to 17. Families benefit from the full credit if they earn up to $150,000 for a couple or $112,500 for a family with a single parent.

Since July, the U.S. Treasury has given more than 35 million households about $250 to $300 a month for each child under age 18, a policy some analysts say is already significantly reducing childhood poverty.

A four-year extension would make it a significant slice of the proposed $3.5 trillion spending package being pursued by Democratic congressional leaders. That legislation is opposed by congressional Republicans as too expensive. Even some Democrats including pivotal Sen. Joe Manchin have questioned its price tag.

The tax credit already is being felt by Americans benefiting from it.

Lolitha Maria Scott, a 41-year old call center worker in Phoenix with five children, described the tax credit as a lifeline that she thinks should continue beyond this year because many working parents like her struggle to keep up with rising rent bills.

"I understand people say it's costly for the budget but it also helps the American people," Scott said in an interview.

Scott said the policy helped cement her plan to vote for Democratic Sen. Mark Kelly, who is seeking re-election next year in Arizona.

Jeremy Monk, 43, an occupational therapist in Palm Bay, Florida, voiced concern that paying for such policies could lead to higher taxes in the future. Monk, a Republican, said in an interview that taking the payments made him feel like he is robbing from his children's future.

"It puts a little bit of a shiver up my spine," said Monk, who added that he put his tax credit payment in college savings funds for his son and daughter.

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