NEWS

Child Tax Credit payments now hitting bank accounts

By ARDEN BASTIA
Posted 7/22/21

By ARDEN BASTIA Paul Salera, president and CEO of Westbay Community Action, has witnessed firsthand how the pandemic impacted families, whether it was a parent who lost their job or a child struggling with distance learning. Starting July 15, the Child

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NEWS

Child Tax Credit payments now hitting bank accounts

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Paul Salera, president and CEO of Westbay Community Action, has witnessed firsthand how the pandemic impacted families, whether it was a parent who lost their job or a child struggling with distance learning. Starting July 15, the Child Tax Credit payments of the American Rescue Plan began distribution to eligible families; a payment Salera believes could really make a difference.

The American Rescue Plan includes a Child Tax Credit, wherein parents receive a credit based on the number of children up to the age of 17 in the household.

According to a press release from Senator Sheldon Whitehouse, the American Rescue Plan increased the Child Tax Credit to $3,600 per child under the age of 6 and $3,000 per child ages 6 though 17. Working families will get the full credit if they make up to $75,000 for a single filer, $250,000 for a couple, or $112,500 for a family with a single parents who files as head of household.

According to the release, these payments are “projected to cut child poverty in half, reduce overall poverty by a third, and help an entire generation of kids get off to a stronger start.”

The law also temporarily makes the credit refundable, meaning families will benefit even if they owe no income tax.

Additionally, the Child Tax Credit would be sent to families in monthly installments to provide-much needed consistent support. Parents can expect to receive up to $300 per month for children up to 5 years old and $250 per month for children ages 6 to 17 starting in the next few weeks and continuing through until December. The remainder of the credit will be included in tax refunds during the filing season next spring.

In an interview Tuesday, Salera pointed out that for many families, this tax credit could be a big help.

According to Salera, many of the families that Westbay Community Action serves are single-parent households.

With executive moratoriums on bills and evictions coming to an end, Salera said many families are now finding themselves faced with rising, unanticipated costs.

“During the pandemic, working families either had reduced hours, lost their second or third jobs, and many were required to be at home because their kids had virtual school,” he said, noting that because families are home 24/7, water and sewer bills have doubled or tripled.

“We’ve seen a huge increase across the board,” said Salera. “Food insecurity, rental and utility help, water bills, and a large demand for electric help.”

Salera shared that in a more typical year, Westbay served around 1,200 households per month, or about 2,025 individuals per month. Since April 1, 2020, Westbay has served more than 50,000 individuals.

Westbay partnered with Plates with a Purpose, a local nonprofit that connects restaurants with households that are struggling to meet food needs, to deliver pre-made meals to families.

Salera also noted the increase in home delivery of meals. Prior to the pandemic, Westbay served about 75 to 100 elderly or disabled homebound residents. During the pandemic, Westbay averaged 400 per month.

Salera said the Child Tax Credit will “help people get back on their feet. Even $300 could help offset some of the debt they’ve had over the last 18 months,” including paying water or electric bills, car repairs, or mortgages.

Even though those that use Westbay services may get the payments, Salera doesn’t expect them to stop using Westbay services.

Salera noted that 56 percent of those that use Westbay services are currently employed.

Salera also added that for a family with children, childcare is the largest cost.

Westbay Community Action offers a childcare program for kids aged 18 months to 12 years old. The center also offers toddler, preschool, pre-kindergarten and school-age programs.

When the pandemic first hit, Westbay, among other childcare centers, were forced to close. Now back in operation, Salera says the program is only about 60 percent full.

Because many parents are still working from home, many kids didn’t need to return to Westbay’s childcare center.

Salera called the reopening “tough” and the low attendance “unfortunate”, but did share that Westbay was able to provide scholarships for families in the childcare program.

“We were able to secure funding to provide every household in the childcare facility with a scholarship that substantially reduced tuition for eight weeks,” he said.

For next year, Salera is planning on allocating for only a 75 percent childcare attendance in the budget.

“It’s unknown what the fall may look like, as a lot of businesses are just starting to consider reopening or a hybrid model of work,” he said.

“If people didn’t need our services, I’d move on to something else,” said Salera. “But the fact is people are living paycheck to paycheck and with the rising cost of living, renting, or buying a house, our services are needed.”

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