Short-term effects of the earned income tax credit on children's physical and mental health

Overview

Childhood poverty is associated with worse health outcomes, including poor physical and cognitive development, and can adversely influence social and health outcomes in later life. While there is increasing interest in policies to address childhood poverty, limited research exists on whether current U.S. poverty alleviation policies, including the largest such program, the Earned Income Tax Credit (EITC), improve children's health. Building on their prior work on the impacts of EITC, Akansha Batra, MS, and Rita Hamad, MD, PhD, examined the short-term effects of the EITC on children's physical and mental health in this study published in Annals of Epidemiology.

Findings

Drawing on data from the National Health Interview Survey (1998–2016), the research team examined the effects of the EITC on children’s food insecurity, weight status, and mental health. They compared EITC-eligible families interviewed in February–April, the months in which tax refunds are typically received, with those interviewed in the other months, “differencing out” seasonal trends in outcomes among noneligible families. They found:

• Receipt of an EITC refund was associated with decreased food insecurity in the short term.
• There were no effects on children’s weight status or mental health.

Implications for Policy and Practice

These findings suggest that the added income from the EITC contributes to a modest increase in household food purchases for families with children. Conversely, the findings also imply that food insecurity is worse during the months of the year that are further from receipt of the tax refund. To reduce the cyclical nature of food insecurity among EITC recipients over the course of the year, policymakers may want to consider permanent ways to allow recipients to receive their EITC refunds throughout the year, instead of as an annual lump sum.