Four major policies in the American Rescue Plan (ARP) will reduce the number of people in poverty in 2021 from 44 million to 28 million – shrinking the overall poverty rate from 13.7 percent to 8.7 percent. Additional $1,400 payments could further reduce poverty to between 6.4 and 6.6 percent,...
The Earned Income Tax Credit (EITC) provides substantial support for working families with low and moderate incomes, including those who may participate in traditional safety net programs, such as TANF. Based on incomes in 2019, the Tax Policy Center...
The earned income tax credit (EITC) and child tax credit (CTC) provide substantial benefits to working families with children. The EITC also provides modest benefits to workers without custodial children, often called “childless workers” for tax purposes. Together, the credits lift almost 9...
Federal tax law provides several tax benefits for homeowners. This chartbook focuses on the home mortgage interest deduction. We provide updated estimates of the distributional effects of the home mortgage interest deduction, show how those estimates could change if people pay down their home...
This report analyzes the main provisions of the federal income tax code that provide benefits to families with children, comparing current law with what would be happening had the TCJA not been enacted, and discusses the TCJA’s implications for families of different income levels. On net, almost...
The earned income tax credit provides substantial assistance to low- and moderate-income workers. Benefits tilt heavily to families with children. Prompted in part by the success of the credit and in part by shortcomings in the credit, policymakers, advocates, and analysts have offered up reform...
The cost-of-living refund (CLR), a proposal from the Economic Security Project, would revise the current earned income tax credit (EITC) by increasing benefits for many people, expanding eligibility for the credit, and paying the credit in advance via monthly payments. The proposal would provide...
This report analyzes a straightforward mechanism to mitigate middle-class wage stagnation: a wage tax credit of 100 percent of earnings up to a maximum credit of $10,000, called a universal earned income tax credit. The child tax credit would increase from $2,000 to $2,500 and be made fully...
The Tax Cuts and Jobs Act (TCJA) missed an opportunity to help low-income childless workers, very low-income families with children, and families with young children – all groups where investments could be particularly productive. The child tax credit (CTC) and earned income tax credit (EITC)...
The Protecting Americans from Tax Hikes Act of 2015 requires the IRS to delay tax refunds for taxpayers who claim an earned income tax credit or additional child tax credit on their returns until at least February 15. The delay could help the IRS better check claims for these credits. But this...
How Additional Cash Payments Would Reduce Poverty
Four major policies in the American Rescue Plan (ARP) will reduce the number of people in poverty in 2021 from 44 million to 28 million – shrinking the overall poverty rate from 13.7 percent to 8.7 percent. Additional $1,400 payments could further reduce poverty to between 6.4 and 6.6 percent,...
The Earned Income Tax Credit: Program Outcomes, Payment Timing, and Next Steps for Research
Introduction
The Earned Income Tax Credit (EITC) provides substantial support for working families with low and moderate incomes, including those who may participate in traditional safety net programs, such as TANF. Based on incomes in 2019, the Tax Policy Center...
Boosting Wages or Helping Children? Understanding How New Earnings and Child Tax Credit Proposals Impact Income Inequality and Vulnerable Children
The earned income tax credit (EITC) and child tax credit (CTC) provide substantial benefits to working families with children. The EITC also provides modest benefits to workers without custodial children, often called “childless workers” for tax purposes. Together, the credits lift almost 9...
Effects of Tax Incentives on Homeownership
Federal tax law provides several tax benefits for homeowners. This chartbook focuses on the home mortgage interest deduction. We provide updated estimates of the distributional effects of the home mortgage interest deduction, show how those estimates could change if people pay down their home...
Shifting Child Tax Benefits in the TCJA Left Most Families About the Same
This report analyzes the main provisions of the federal income tax code that provide benefits to families with children, comparing current law with what would be happening had the TCJA not been enacted, and discusses the TCJA’s implications for families of different income levels. On net, almost...
Redesigning the EITC: Issues in Design, Eligibility, Delivery, and Administration
The earned income tax credit provides substantial assistance to low- and moderate-income workers. Benefits tilt heavily to families with children. Prompted in part by the success of the credit and in part by shortcomings in the credit, policymakers, advocates, and analysts have offered up reform...
Expanding the Earned Income Tax Credit: The Economic Security Project’s Cost-of-Living Refund
The cost-of-living refund (CLR), a proposal from the Economic Security Project, would revise the current earned income tax credit (EITC) by increasing benefits for many people, expanding eligibility for the credit, and paying the credit in advance via monthly payments. The proposal would provide...
A Universal EITC: Sharing the Gains from Economic Growth, Encouraging Work, and Supporting Families
This report analyzes a straightforward mechanism to mitigate middle-class wage stagnation: a wage tax credit of 100 percent of earnings up to a maximum credit of $10,000, called a universal earned income tax credit. The child tax credit would increase from $2,000 to $2,500 and be made fully...
Who Benefits from Expanding the EITC or CTC?
The Tax Cuts and Jobs Act (TCJA) missed an opportunity to help low-income childless workers, very low-income families with children, and families with young children – all groups where investments could be particularly productive. The child tax credit (CTC) and earned income tax credit (EITC)...
Delaying Tax Refunds for Earned Income Tax Credit and Additional Child Tax Credit Claimants
The Protecting Americans from Tax Hikes Act of 2015 requires the IRS to delay tax refunds for taxpayers who claim an earned income tax credit or additional child tax credit on their returns until at least February 15. The delay could help the IRS better check claims for these credits. But this...