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Homepersonal financeMonthly child tax credit may arrive as states end $300 unemployment boost

Monthly child tax credit may arrive as states end $300 unemployment boost

  • At least 23 states are withdrawing from federal unemployment programs between mid-June and mid-July.
  • Meanwhile, the IRS will start sending monthly payments of the child tax credit July 15. Families can expect up to $250 or $300 per child each month, depending on kids' age.

Oscar Wong | Moment | Getty Images

Nearly two dozen states are ending federal unemployment benefits early, meaning millions of people will soon see their aid reduced or eliminated.

But families can expect a cash infusion from a different source — the child tax credit — roughly around the same time their jobless benefits dry up.

The IRS will start sending monthly payments of the tax credit starting July 15, the agency said last week. Eligible households will get up to $300 per child under age 6 and $250 for older kids under 18.

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Meanwhile, states are withdrawing from unemployment programs anywhere from mid-June through mid-July.

Funds from the child tax credit may help offset some of a household's lost income if laid-off workers lose unemployment benefits but aren't able to find a job or return to work.

Roughly 46% of households receiving unemployment benefits also have kids under age 18, according to the U.S. Census Bureau's Household Pulse Survey.

"It will help," according to Heidi Shierholz, director of policy at the Economic Policy Institute, a progressive think tank, and former chief economist at the Department of Labor. "But for most families it will be just a fraction of what they're losing."

States ending unemployment supplement

At least 23 states have announced their intent to pull out of pandemic-era programs that give recipients an extra $300 a week in unemployment benefits. Most are also ending aid for the self-employed, gig workers, and the long-term unemployed, generally defined as those out of work more than six months.

Alaska, Iowa, Mississippi and Missouri are ending that aid June 12, the earliest among the states. Arizona, the last, will do so July 10.

The American Rescue Plan offers those federal benefits until Sept. 6.

The average person received roughly $2,500 a month in total unemployment benefits in April, according to an analysis of Labor Department data. The analysis includes the $300 weekly federal supplement.


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