The Impact of Tax Refund Delays on the Experience of Hardship and Unsecured Debt

Author

Olga Kondratjeva, Washington University in St. Louis
Stephen Roll, Washington University in St. Louis
Mathieu Despard, Washington University in St. Louis
Michal Grinstein-Weiss, Washington University in St. Louis

Publication Date

6-9-2020

Publisher

Social Policy Institute at Washington University in St. Louis

Summary

The Earned Income Tax Credit (EITC) provides substantial financial support to low-income workers, yet around a quarter of EITC payments are estimated to be erroneous or fraudulent. Beginning in 2017, the Protecting Americans from Tax Hikes Act of 2015 requires the Internal Revenue Service to spend additional time processing early EITC claims, delaying the issuance of tax refunds. Leveraging unique data, we investigate how delayed tax refunds affected the experience of hardship and unsecured debt among EITC recipients. We find that early filers experienced increased food insecurity relative to later filers after the implementation of the refund delay.

Document Type

Journal Article

Notes

This document is the unedited author’s version of a submitted work that was subsequently accepted for publication in Journal of Consumer Policy, copyright ©️ 2022, after peer review. To access the final edited and published work see https://doi.org/10.1007/s10603-021-09501-4

DOI:

https://doi.org/10.7936/37s1-bq53

Project

Refund to Savings (R2S)

Recommended Citation

Kondratjeva, Olga; Roll, Stephen; Despard, Mathieu; and Grinstein-Weiss, Michal, "The Impact of Tax Refund Delays on the Experience of Hardship and Unsecured Debt" (2020). Social Policy Institute Research. 28.
https://openscholarship.wustl.edu/spi_research/28