How Fines and Fees Impact Families: Can Policies like the Child Tax Credit Help?

Low-income families burdened by court-imposed financial penalties often turn to high cost predatory services or forgo basic needs to avoid further legal consequences for nonpayment. In 2021, the Child Tax Credit (CTC) was temporarily expanded to provide families with additional resources. Early surveys show that 40 percent of respondents reported using the CTC to pay off some of their debts, and helped others avoid relying on high-cost financial services. For families who prioritized paying fines and fees, the CTC may have also offered additional relief to meet the basic needs of their children. Despite the CTC’s usefulness in filling critical gaps for families facing hardships from fines and fees, the authors warn that more permanent and targeted solutions to address the systemic problems and inequities with fines and fees are critical.

Read the full report here

Aravind Boddupalli and Elaine Maag
Urban-Brookings Tax Policy Center