Child Tax Credit Payout Of $15B+ Could Mean Big Spending Across US
The U.S. Department of the Treasury and the Internal Revenue Service on Friday (Aug. 13) paid more than $15 billion to families for the almost 61 million children eligible for the expanded Child Tax Credit from the American Rescue Plan.
This month’s Child Tax Credit payout included about 1.6 million more children than the initial batch in July, according to the department announcement. Eligible families will get $300 a month for each child under 6 years old and up to $250 a month for each child ages 6 to 17 under terms of the plan.
The Biden Administration also vowed to work with Congress on extending the Child Tax Credit (CTC) payments beyond 2021.
The Treasury and White House announced Friday that a mobile-friendly, bilingual CTC sign-up tool by civic technology non-profit Code for America will be available in the coming weeks. Most families will get their August payments by direct deposit, while the rest will receive monthly checks in the mail. A technical issue means some who got direct deposit in July will get paper checks for the August CTC.
Related: The Child Tax Credit Is Rolling Out: How It Will Be Spent, What’s Next
While the Treasury announcement said the Child Tax Credit is helping families buy food and other necessities, the retail industry is hoping some of those monthly checks will find their way into stores too, especially during back-to-school shopping season.
The National Retail Foundation forecast last month that consumers are on track “to spend a record amount to prepare students for school,” singling out apparel and school supplies. As of early June, one-quarter of back-to-school and college shoppers had already started picking up items for their fall classes, up from 21 percent last year and 17 percent in 2019.
Research by Cowen shows Walmart and Target are expected to be the biggest beneficiaries of the influx of spending money.