Effect of Expanding the Earned Income Tax Credit to Americans Without Dependent Children on Psychological Distress

• Published in: American journal of epidemiology Vol. 191; no. 8; pp. 1444 - 1452
• Main Authors: Courtin, Emilie, Allen, Heidi L, Katz, Lawrence F, Miller, Cynthia, Aloisi, Kali, Muennig, Peter A
• Format: Journal Article
• Language: English
• Published: United States Oxford University Press 23.07.2022
• Subjects: Child; Female; Humans; Income; Income Tax; Poverty; Psychological Distress; Taxes; United States; United States; Earned Income Tax Credit; randomized controlled trials; psychological distress; social experiments
• ISSN: 0002-9262; 1476-6256
• DOI: 10.1093/aje/kwab164

Abstract Antipoverty policies have the potential to improve mental health. We conducted a randomized trial (Paycheck Plus Health Study Randomized Controlled Trial, New York, New York) to investigate whether a 4-fold increase in the Earned Income Tax Credit for low-income Americans without dependent children would reduce psychological distress relative to the current federal credit. Between 2013 and 2014, a total of 5,968 participants were recruited; 2,997 were randomly assigned to the treatment group and 2,971 were assigned to the control group. Survey data were collected 32 months postrandomization (n = 4,749). Eligibility for the program increased employment by 1.9 percentage points and after-bonus earnings by 6% ($635/year), on average, over the 3 years of the study. Treatment was associated with a marginally statistically significant decline in psychological distress, as measured by the 6-item Kessler Psychological Distress Scale, relative to the control group (score change = −0.30 points, 95% confidence interval (CI): −0.63, 0.03; P = 0.072). Women in the treated group experienced a half-point reduction in psychological distress (score change = −0.55 points, 95% CI: −0.97, −0.13; P = 0.032), and noncustodial parents had a 1.36-point reduction (95% CI: −2.24, −0.49; P = 0.011). Expansion of a large antipoverty program to individuals without dependent children reduced psychological distress for women and noncustodial parents—the groups that benefitted the most in terms of increased after-bonus earnings.