This explainer is based on Families as the Hidden Tax Base: How the Costs of Incarceration Are Shifted to Families. All statistics and findings are drawn directly from this source.
TL;DR
Prison systems shift the cost of basic needs onto families. Families spend about $4,200 a year just to keep loved ones fed, clean, and in touch. The total cost to families is nearly $350 billion a year. That’s almost four times what taxpayers spend on prisons. Women and Black families pay the most. This system traps families in debt and poverty.
Why This Matters
If someone you love is in prison, you already know this story. You send money so they can eat. You pay high fees just to hear their voice. You skip your own bills to keep them safe.
This report puts numbers to what families live every day. It shows that the state is not paying the full cost of running prisons. Instead, it pushes those costs onto you — the families. And it does this through a system of high prices, hidden fees, and no-choice vendors that drain your savings and push you into debt.
This matters because it’s not just unfair. It’s a system that makes poverty worse. It hurts children. It widens the gap between Black and white families. And it happens in the dark, with almost no oversight.
Key Takeaway: The state fails to provide basic needs in prison, then forces families to fill the gap at inflated prices.
The $350 Billion Burden on Families
A 2025 study by FWD.us surveyed more than 1,600 people with loved ones in prison. It found that families pay nearly $350 billion a year in total costs. That’s almost four times the $89 billion taxpayers spend on jails and prisons.
Here’s where that money goes:
- $5.6 billion a year on commissary (the prison store), phone calls, and basic needs — with prices marked up as much as 600% above store prices
- $1.8 billion a year on travel for visits
- $2.3 billion a year on childcare for kids of people in prison
- $6.7 billion a year in lost household income
- $111 billion a year in lower pay for people after they get out
- $215 billion a year in lower lifetime pay for children of people in prison — an average loss of $4,468 per child per year of adult life
The average family with someone in prison spends $4,200 a year out of pocket. For someone living at the poverty line, that’s more than 27% of their income — more than one dollar out of every four.
Key Takeaway: Families pay nearly $350 billion a year — almost four times what taxpayers spend on prisons.
Commissary: A Store With No Competition
When prisons don’t provide enough food or basic items, families have to buy them through the prison store. But the prison store has no rivals. People in prison can’t shop anywhere else. So prices are sky-high.
A nine-month study of 46 states found markups from 40% to 600% above retail prices. In Georgia, peanut butter is marked up over 70%. In Missouri, ramen costs over 65% more than outside.
The total value of this market is about $1.6 billion a year. The average person in prison spends $947 a year at the commissary.
Meanwhile, prison wages average just $0.13 an hour at the low end. The high end averages $0.52 an hour. Seven states pay nothing at all. That means families — not the people in prison — are paying most of these bills.
Where does the profit go? Vendors pay a cut of their sales back to the prison. In Florida, the Keefe Group pays a 35.6% kickback on a $175 million contract. These kickbacks flow into accounts called “Inmate Welfare Funds.” But these funds have almost no oversight. One Georgia county leader said he had “never heard of the committee” that was supposed to watch the money.
Key Takeaway: Prison stores charge 40% to 600% above retail prices, and families foot the bill because prison wages are nearly nothing.
Phone Calls: Paying to Stay Connected
Before reforms, families paid as much as $1 a minute for prison phone calls. Phone companies paid kickbacks to prisons to win contracts. Then they raised prices on families to cover the cost.
The total revenue from prison phone calls alone was about $1.4 billion a year. That doesn’t include video calls or messages.
In 2022, Congress passed the Martha Wright-Reed Act. This law gave the FCC the power to cap phone rates. In 2024, the FCC set caps at $0.06 per minute for large prisons. It also banned kickbacks.
But in 2025, a new FCC leadership rolled back these protections. The new rates jumped to $0.10 per minute for large prisons. FCC member Anna Gomez said the agency was “shielding a broken system that inflates costs and rewards kickbacks.”
Some states have stepped up. California, Connecticut, Massachusetts, Minnesota, and Colorado now require free calls in state prisons. New York City jails also offer free calls.
Key Takeaway: Phone companies and prisons split the profits while families pay inflated rates just to talk to loved ones.
Money Transfers: Fees Just to Send Help
When families send money to a loved one in prison, they often have no choice but to use one company: JPay. JPay serves 1.7 million people in prison across 32 states. For 40% of families, JPay is the only option.
To send just $50, a family pays $6.95 in fees. Fees can reach 35% of what you send. In some states, they get close to 45%. Before JPay, families could mail a money order for about $2.
In 2021, the federal consumer watchdog (CFPB) punished JPay for breaking the law. JPay had charged fees to people just to get their own money. It forced people leaving prison to sign up for a JPay debit card to get their release funds. This happened in California, Colorado, and Georgia.
As one lawyer put it: “It’s not just the money transfer that’s the problem. It’s the system it enables to shift costs onto families.”
Key Takeaway: Families pay fees up to 45% just to send money — and often have no other choice.
Pay-to-Stay: Charged for Your Own Prison Cell
48 states allow at least one type of “pay-to-stay” fee. This means people in prison can be charged for the cost of being locked up. Only California and Illinois have gotten rid of all such fees.
These fees range from $20 to $80 per day. In Florida, courts can charge up to $50 a day. And the charge is based on the sentence length — not how long you actually serve. One person, Shelby Hoffman, owed $127,500 for a 10-year sentence. She got out after just 10 months.
States can take money from wages, tax refunds, pensions, veterans benefits, and even lawsuit payments to collect these fees. A study found that 10 million people owe a total of $50 billion in prison debt.
On top of that, 40 states charge for doctor visits in prison. Copays range from $2 to $13. When you earn $0.13 an hour — or nothing — even a $2 copay is a real barrier to care.
Key Takeaway: 48 states charge people for the cost of their own prison stay, and 10 million people owe $50 billion in prison debt.
Women Pay the Most
Every major study finds the same thing: women carry the heaviest load.
In 63% of cases, family members on the outside were mainly paying court costs. Of those family members, 83% were women. Mothers of people in prison spend a median of $286 a month. Spouses and co-parents spend $276 a month — about 12% of household income.
Women face a pileup of costs: lost income, new bills, childcare, and the stress of holding a family together. They pay amounts close to what men pay. But it takes a bigger share of their income.
As one woman told researchers: “I’m not incarcerated but it feels like I’m incarcerated because I’m going through it with her.”
Key Takeaway: 83% of family members paying court costs are women, and mothers spend the most each month.
Black Families Hit Hardest
Black families pay 2.5 times more than white families. On average, Black family members spend $8,005 a year. White family members spend $3,251 a year.
Black families are also twice as likely to have more than one person in prison at the same time. They contribute a median of $200 a month — about 9% of household income. White families contribute $120 a month.
This drains wealth from communities that already have less. Having a family member in prison cuts household savings by 64.3%. It raises debt by 85.1%. Children of fathers who were in prison are 3 times more likely to face being without a home.
One in five Black men born to the poorest families was in prison on April 1, 2010. This was 21% of that group.
Researchers call mass incarceration a “missing variable” in the racial wealth gap. The harm is invisible (people in prison don’t show up in most money-related data). It builds over time. And it passes down to children, who lose an average of $4,468 a year in lifetime pay.
Key Takeaway: Black families pay 2.5 times more than white families, deepening the racial wealth gap across generations.
Families Can’t Meet Basic Needs
The costs of having a loved one in prison push whole families into crisis:
- 65% of families can’t meet basic needs because of these costs
- 49% struggle to afford food
- 48% have trouble paying for housing
- 1 in 5 families is forced to move
- 9% of family members have been without a home
- 70% of families who can’t meet basic needs are caring for children
The average debt from court fines and fees alone is $13,607. For families earning less than $15,000 a year, that’s almost a full year’s income.
1 in 3 families goes into debt just to cover phone calls and visits.
Key Takeaway: 65% of families can’t meet basic needs because of the money they spend on a loved one’s prison costs.
Signs of Progress — and Setbacks
Some places are starting to fix the problem:
- Free phone calls: California, Connecticut, Massachusetts, Minnesota, and Colorado now require free calls in state prisons
- No more kickbacks: At least 9 states ban kickback-based phone contracts
- Debt forgiven: Dauphin County, Pennsylvania wiped out $65.9 million in jail debt in 2024
- Pay-to-stay repealed: Illinois and New Hampshire ended these fees in 2019. Missouri followed in 2025.
- Fair commissary prices: San Francisco ended commissary markups. The loss was just 0.17% of the Sheriff’s budget.
But there have been setbacks too. In 2025, the FCC raised phone rate caps and brought back some fees. Phone companies continue to bundle services in ways that dodge rate limits.
The Dauphin County leader who forgave jail debt said it best: “We were spending money on programs to help people rejoin society while making it almost impossible for them to get credit, a place to live, or a car loan.”
Key Takeaway: Reform is possible — San Francisco ended commissary markups with almost no budget impact — but progress faces pushback.
Glossary
- Family Tax: The money families must spend when prisons don’t provide basic needs like food, health care, and hygiene. Families pay inflated prices through companies that have no rivals.
- Commissary: The prison store. People in prison buy food, soap, and other items here — often at 40% to 600% above regular store prices.
- Kickback (Site Commission): A share of sales that a private company pays to a prison in exchange for being the only vendor. This pushes prices up.
- Inmate Welfare Fund: A pot of money funded by kickbacks that is supposed to help people in prison. In practice, these funds have little oversight and are often misused or not spent.
- Pay-to-Stay: Fees charged to people in prison for the cost of being locked up — often $20 to $80 per day.
- Copay: A fee people in prison must pay each time they see a doctor — $2 to $13 per visit.
- Martha Wright-Reed Act: A 2022 federal law that gave the FCC the power to set limits on prison phone rates.
- JPay: The main company families use to send money to people in prison. It serves 1.7 million people in 32 states and often has no rivals.
- FCC: The Federal Communications Commission — the agency that sets rules for phone and video call prices.
- CFPB: The Consumer Financial Protection Bureau — the federal agency that watches out for unfair money practices.
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