In an illuminating new study from UCLA Health, researchers have uncovered critical insights into the differential impacts of the 2021 expanded Child Tax Credit (CTC) on energy insecurity across socioeconomic groups in the United States. Energy insecurity, a pervasive condition characterized by households’ inability to secure sufficient energy for basic heating, cooling, and electricity needs, presents serious risks to health and wellbeing, especially for families with children. The study, which rigorously analyzed survey data from 2021 to 2022, found that the expiration of the enhanced Child Tax Credit corresponded with a significant rise in energy insecurity among middle-class families, while the poorest households showed no measurable improvement or decline. These findings, published in the American Journal of Public Health, underscore the complex socio-economic dynamics that govern the efficacy of tax credits as tools for public health and social support.
Energy insecurity is a multifaceted phenomenon that unfortunately remains widespread in the United States, affecting approximately one-third of households. It presents not only immediate discomfort but also a cascade of health hazards, including increased exposure to extreme temperatures. Families forced to adopt dangerous coping mechanisms—such as relying on unsafe heating equipment prone to causing fires—face heightened risks alongside chronic stress that can impair both parental functioning and child development. This study addresses a critical and timely issue, as rising energy costs and the increasing frequency of extreme weather events intensify the urgency to find effective, scalable interventions.
The researchers employed a difference-in-differences methodological approach, leveraging nationally representative survey datasets from 2021 through 2022 to assess shifts in energy insecurity following the expiration of the expanded CTC. By comparing households with children—eligible for the tax credit—with those without, they isolated the effect of the policy change. Furthermore, stratifying households by their income levels relative to the federal poverty line allowed for nuanced analysis across economic subgroups. This rigorous approach strengthens the validity of the findings, revealing not only overall trends but importantly, the heterogeneity of the credit’s impact across varying income brackets.
Results demonstrated a 4% relative increase in households unable to pay their energy bills after the credit expired, amounting to approximately 308,560 additional families facing energy insecurity. Notably, this adverse effect was isolated predominantly to families within the middle-income brackets—those earning between 200% and 600% of the federal poverty level. These households experienced sharp upticks in the prevalence of energy insecurity, suggesting that the expanded Child Tax Credit had been a crucial buffer against energy hardship for these groups. Conversely, the lowest-income families, earning less than 200% of the poverty level, showed no significant change, indicating that the credit did not significantly alleviate energy insecurity within this demographic.
This counterintuitive finding prompts deeper consideration of the socioeconomic factors mediating the credit’s impact. One plausible explanation lies in the structure of other assistance programs. Lower-income families frequently qualify for additional supports such as the Supplemental Nutrition Assistance Program (SNAP) and the Low Income Home Energy Assistance Program (LIHEAP). However, these benefits often decline abruptly as income rises beyond certain thresholds—a phenomenon commonly referred to as the “benefit cliff.” Middle-income families just above these cutoffs may be left in a precarious position: ineligible for targeted programs yet insufficiently resourced to cover essential needs adequately. The study suggests that the expanded CTC provided vital, though temporary, relief to these families, which was lost following policy expiration.
Moreover, the research highlights that lower-income families face intense competing needs. Limited financial resources are often allocated across immediate survival essentials, such as food, medicine, or debt repayment, leaving less discretionary income for energy bills. Consequently, even with increased Child Tax Credits, these households may prioritize expenditures that support more immediate survival needs rather than energy payments, diluting the potential effect of such credits on energy security. This multidimensional challenge signals the necessity for multifaceted policy approaches that address the layered vulnerabilities of impoverished families.
The study’s implications extend into the broader discourse on policy design and social equity. The finding that middle-income groups disproportionately benefited from the expanded Child Tax Credit brings to light important considerations regarding eligibility thresholds and credit sizing. It raises pressing questions about the adequacy of current social support mechanisms in reaching those in deepest need, and whether enhanced or differently structured credits might better serve the most vulnerable. Furthermore, it underscores the need for complementary policies that can bridge support gaps and provide holistic assistance encompassing both energy and non-energy essentials.
Environmental and public health experts will take particular interest in the study’s contribution to understanding energy insecurity as a determinant of health outcomes. Energy insecurity’s link to adverse health effects—ranging from respiratory illness tied to suboptimal heating and cooling, to psychological stress stemming from financial strain—is increasingly recognized. By delineating how tax policy can modulate such outcomes, this research enriches the evidence base essential for crafting interventions capable of mitigating health disparities tied to economic insecurity and environmental risks.
Importantly, the study’s temporal design, examining the period before and after the expiration of the expanded Child Tax Credit, offers a quasi-experimental framework that moves beyond correlation to suggest causation. This methodological rigor enhances confidence that the policy’s removal precipitated observable increases in energy insecurity among affected households. The use of representative survey data further positions these findings as generalizable across the United States, with potential applicability to other settings grappling with similar social and energy affordability challenges.
Looking forward, the researchers advocate for future investigations into larger or more targeted credits that might effectively reach the lowest-income families and materially improve their energy security. This approach recognizes that the baseline provision may have been insufficient for the diverse needs within impoverished populations, where even incremental financial support can be quickly absorbed by essential living costs. Additionally, expanding research on the intersection of energy insecurity with extreme weather events, climate change, and rising energy prices is crucial in forecasting and mitigating future public health impacts.
Dr. Cecile Yama, the study’s lead author and a physician at UCLA, encapsulates the findings with a call for nuanced policy innovation. “This study shows that the expanded Child Tax Credit provided meaningful benefits to middle class families struggling to pay their energy bills, but that the poorest families are being left out,” she notes. “The fact that middle-class families saw reduced energy insecurity when they had the credit, but the poorest families didn’t, tells us two things: middle class families need this financial support to survive, and our poorest families may need even more.” This insight presents a clear mandate for policymakers, researchers, and advocates working to address energy insecurity, economic inequities, and associated health disparities.
In sum, the expiration of the 2021 expanded Child Tax Credit revealed significant vulnerabilities among U.S. families, particularly those within middle-income brackets who lacked access to other forms of assistance. As energy costs continue to escalate and climate-related stressors intensify, understanding and addressing the nuanced dynamics of energy insecurity through informed tax and social policies will be paramount. This study advances the frontier of knowledge in this critical area, offering a data-driven foundation for future interventions aimed at achieving energy justice and safeguarding public health.
Subject of Research: The impact of the expiration of the expanded Child Tax Credit on energy insecurity among U.S. households with children, analyzed across different income levels.
Article Title: Expiration of the Expanded Child Tax Credit and Energy Insecurity in US Households With Children, 2021–2022
News Publication Date: 5-Jun-2025
Web References:
https://ajph.aphapublications.org/doi/epdf/10.2105/AJPH.2025.308105
References:
Expiration of the Expanded Child Tax Credit and Energy Insecurity in US Households With Children, 2021–2022. American Journal of Public Health, Volume 115, Issue 6, Pages e1–e10. DOI: 10.2105/AJPH.2025.308105
Keywords: Public health; energy insecurity; Child Tax Credit; socioeconomic disparities; energy affordability; health policy; poverty; middle-class families; tax policy; social assistance programs; energy justice
