Increasing Families' Incomes Helps Meet Children's Needs and Reduces Child Welfare Involvement

When parents have enough money to pay their bills, buy nutritious food, and spend quality time with their children, they are better able to respond to their children’s needs and create a nurturing home, something every child deserves.

Supporting families and improving economic security have many benefits, including reducing near-term hardship among families with children.^[2] Evidence from a wide range of income support programs also shows another important benefit — reducing involvement in the child welfare system.

As policymakers seek to keep children safe and supported at home and out of the child welfare system, they can help by better aligning families’ resources with what children need to thrive. Recent research suggests that each $1,000 in unrestricted cash a family receives early in a child’s life reduces the likelihood of that child experiencing a substantiated referral for maltreatment, with estimated reductions between 3 and 15 percent.^[3]

The child welfare system processes over 2 million reports of child maltreatment annually.^[4] Maltreatment includes both neglect and abuse and is defined differently in each state.^[5] States have grappled with distinguishing definitions of neglect from poverty, and experts agree that insufficient income and lack of resources alone should not be a cause for reporting child welfare cases. Yet, when parents cannot afford enough groceries to last the week, secure appropriate child care while they work, or afford to move out of inadequate living conditions, it can attract the attention of Child Protective Services (CPS), which can increase stress within the family.^[6] Most substantiated child maltreatment cases — 63 percent in 2024 — involve neglect only.^[7]

Nearly three-quarters (71 percent) of families with children and low incomes reported experiencing at least one form of material hardship in 2023, such as not having enough food or having trouble paying their utility bill.^[8] For families of all races, material hardship predicts contact with the child welfare system overall, even after controlling for other risk factors.^[9]

Black, Indigenous, and Latine families in particular experience high rates of poverty and material hardship because a system of past and present discriminatory policies and treatment has excluded many people of color from better schooling, career paths, neighborhoods, and opportunities that would provide more economic security.^[10]

Additionally, there is evidence that families of color experience increased surveillance, differential treatment, and harsher penalties in maltreatment reporting and investigations, which in part may explain why they are disproportionately represented in the child welfare system.^[11] Encounters with the child welfare system may also be especially stressful in Black and Indigenous communities because of the lasting impact of the nation’s history of forced removals of Black and Indigenous children from their families.^[12]

Across Varied Programs, Evidence Links Concrete Supports to Reduced Child Maltreatment

The weight of evidence across multiple programs links income support to reductions in child maltreatment outcomes and exposure to the child welfare system.^[13]

• One 2013 study found that allowing Temporary Assistance for Needy Families (TANF) families to receive the full amount of child support payments collected from non-custodial parents reduced by 10 percent the likelihood that they would have a “screened-in” report of child maltreatment (see text box), relative to families for whom the state retained a portion of their child support.^[14]
• Several recent studies find evidence that state adoption of flexibilities in SNAP, including modestly higher income limits and less restrictive asset tests under the broad-based categorical eligibility (BBCE) policy, predicts increases in SNAP caseloads and subsequent reductions in total reports to CPS, neglect-related reports to CPS, number of children with any substantiated maltreatment report, children with substantiated neglect reports, and foster care entries.^[15]
• One 2022 study estimated that every 1 percent increase in SNAP caseloads is associated with between 2 and 3 percent fewer children in foster care with substantiated reports of maltreatment.^[16]
• Studies of refundable tax credits estimate that for each additional $1,000 families are eligible for as a tax refund, state-level rates of maltreatment referrals are 5 percent lower, and the likelihood that a child born into a household with low income has a substantiated referral by age 2 is lower by 3 percent.^[17]
• In a study of statewide payments funded by Alaska’s oil revenue, for each $1,000 of unconditional cash distributed to families early in a child's life, the child was 10 percent (2 percentage points) less likely to be referred to CPS by age 3 and 15 percent less likely to have a substantiated referral.^[18]

Risk for child abuse and neglect is complex, and income support will not eliminate all cases of maltreatment. However, for families with low incomes, evidence suggests income assistance is an effective tool for reducing child welfare involvement and supporting family stability. The strongest current evidence is for neglect-related outcomes, which comprise the majority of substantiated maltreatment reports; this may be chiefly explained by the close relationship between neglect and material hardship.^[19] Considering that income supports are associated with multiple beneficial effects for families and children, policymakers interested in improving outcomes for children, including through reduced child welfare involvement, should strongly consider ways to strengthen these programs.

Emerging Evidence May Hold New Insights Into the Relationship Between Income and Child Maltreatment

In the last decade, over 100 local guaranteed income pilot programs have provided participants with regular and unconditional cash payments.^[20] Most of these pilots were small and short lived. However, larger randomized controlled trials may offer insights into the effects of cash on family processes and child maltreatment.

The two largest experiments considering unconditional cash transfers to date are Baby’s First Years (BFY) and the OpenResearch Unconditional income Study (ORUS). Though neither research team has published findings on child maltreatment outcomes, both found that parents assigned to receive a larger monthly cash payment improved on measures of parenting quality relative to parents assigned to receive a much smaller payment.^[21] More research is needed to clarify the relationship between unconditional cash payments and parenting behaviors.

Rx Kids is a universal and unconditional program that began in Flint, Michigan, in 2024 and provides every expectant family^[22] living in Flint with $1,500 during pregnancy and $500 per month for the first year after birth, totaling up to $7,500 per pregnancy/infant.^[23] Early evidence suggests that the implementation of Rx Kids may have been followed by a reduction in child maltreatment allegations in the first six months of life among children born in Flint as compared to those born in other Michigan cities.^[24] (This work still needs to be peer reviewed and would be strengthened by more data collected over a longer timeframe.) With bipartisan support from the legislature, Rx Kids has expanded to many more Michigan localities and more findings are forthcoming.^[25]

More evidence is expected soon from an ongoing randomized control trial in Illinois that provides income to families involved in the child welfare system.^[26]

Parents Describe Why Income Support Matters to Them

In addition to quantitative analysis, many guaranteed income pilots also collect rich qualitative data, gathering first-person accounts from participating parents on how the cash payments impacted their family’s stability and material security.

• Regina, a mom to three kids ages 4, 8, and 10, described how having more money meant she had to make fewer difficult trade-off decisions: "Other people say, 'you need to put in more hours.' That might sound logical to some people, but if you think about it, who's gonna watch your kids for you to work more hours?" ... "[With Madison Forward Fund,] I'm not choosing between bills anymore, which one to pay now and which one to wait on to pay later."^[27]
• Ivy, who participated in the ORUS study, said the cash transfer helped her get out of a bad situation and afford a home for herself and her kids: "I was able to be responsible for myself and my kids. And I didn’t need as much help from everyone. And so everyone was able to see me get on my feet, because before I had the [cash transfer] I was in a really bad situation and bad point in my life… I was able to put me and my kids in a home where I was able to pay for the bills."^[28]
• Tameka, another ORUS study participant, described the ongoing impact of having more cash during the study period: "[The cash transfer is] still impacting my life. It's still impacting the lives of my children. My children probably have a hope for something that they probably didn't have hope for before, because we've done something that we've never done. Something that always seemed like maybe a dream is a reality for them because, hey, we have our own home… Them seeing how we went through this process, I'm sure it gave them hope that life can look different."^[29]

By Expanding Access to Cash and Improving Economic Security Programs, Policymakers Can Help Families Raise Their Children in Safe and Healthy Environments

Evidence points to a clear opportunity to help keep children safe at home by shoring up inadequate family income and expanding supports. There are a number of policy options available to states:

• Create or expand state child tax credits that provide the full credit to all low-income children. Currently, the federal Child Tax Credit and some state child tax credits provide only a partial credit, or none at all, to many children because their incomes are too low. Expanding child tax credits so that all children in low-income families receive the full amount helps families who are struggling the most to meet their children’s basic needs.^[30]
• Create or expand refundable state earned income tax credits (EITCs), which help working parents paid low wages afford their family’s basic needs.^[31]
• Increase TANF cash assistance benefit levels and expand access to TANF benefits to help families with children afford housing and other basic needs.^[32] TANF is well situated to support very low-income families, including those where parents are between jobs or unable to work at least temporarily due to health, caregiving needs, or crisis situations like domestic violence.^[33]
• Allow all child support payments to pass directly to families receiving TANF (and former TANF recipients), instead of being retained and divided between the state and federal governments.^[34]
• Maintain and improve flexibility within SNAP, including expanding eligibility through modestly higher income limits and eliminating asset tests using the BBCE option.^[35]
• Create and expand guaranteed income programs and other unconditional cash transfer programs to promote economic security while supporting autonomy and dignity. These efforts should come with robust evaluations so we can continue to build our understanding of what works in helping families thrive.
• Take steps to reduce harm from federal rules that take away assistance in TANF, SNAP, and Medicaid for not meeting work requirements. That includes ensuring that data and systems are in place to identify people who meet exemption criteria or are working, and reducing red tape associated with the requirements. Work requirements take away support families need to afford essentials, such as food and housing; unmet basic needs increase the risk of child welfare involvement — and can make it harder for families that are child-welfare-involved to stay together or reunify.^[36] States can protect families by instituting thoughtful exemptions or providing state-funded help to individuals and families, rather than taking away health coverage or food assistance from them.
• Create safeguards for families so that neither access to nor amount of other benefits are reduced by income gained through participation in cash transfer pilots or experiments.^[37]
• Revise benefit amounts regularly to reflect actual costs of living.
• Reduce administrative burdens that create barriers to housing, food, health, and income assistance.^[38] For example, states can use data from one program to automatically extend eligibility in other programs; utilize third-party databases as well as state data to verify ongoing eligibility; use texting to make sure program participants know the steps they need to complete to maintain their eligibility for programs like WIC, SNAP, Medicaid, and TANF; and develop ways for families to participate in interviews virtually and “on demand” when they have time in their day.
• Ensure that children always have access to basic needs programs, regardless of their own or their parents’ immigration status, and families are not deterred from accessing benefits due to immigration-related fears.
• Remove drug testing policies and lift restrictions on food, income, and housing assistance for people with prior involvement in the criminal legal system.^[39]
• Invest in proven affordable housing and homelessness solutions, including rental assistance; housing instability is associated with increased risk of CPS contact.^[40]
• Enact and enforce laws that prohibit discrimination against people participating in basic assistance programs, such as prohibiting landlords from discriminating against people who will use rental assistance to help pay rent.

Access to flexible wraparound services complement state efforts to increase and expand economic and health supports. Families may need other forms of support based on their individual needs, such as mental health services, child care, or other wraparound services. For example, a parent with a mental health condition will be better able to succeed in treatment and contribute to family well-being if they are stably housed, have adequate food, and access to health care.

The federal government has a role to play as well. First, Congress needs to reverse the harm done by the unprecedented cuts in the 2025 megabill that are projected to take away food assistance and health coverage from millions of U.S. households. These cuts will increase hardship and risk of child welfare involvement for many families and create new strain on state budgets, which in turn makes it harder for states to invest in families.^[41] Reversing harm is not ultimately enough to protect and support children — the federal government should also take affirmative steps. This includes expanding the Child Tax Credit and making it fully available to all children in low-income families and investing in areas like housing and child care to address the very real affordability challenges too many families face.

Conclusion

Taken together, the weight of the current body of evidence indicates that helping families afford the basics through economic supports is associated with reduced instances of child maltreatment. Aligning child welfare policy with current evidence can help states shift from reactive systems to proactive investments that keep children safe, supported, and at home.