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Twelfth Public Meeting October 18, 2005

Twelfth Public Meeting October 18, 2005. The New Family Credit. The provisions to adjust for family size and ability to pay in the current code are redundant and unnecessarily complex. New Family Credit. The New Family Credit. Provides tax benefit comparable to current system

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Twelfth Public Meeting October 18, 2005

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  1. Twelfth Public Meeting October 18, 2005

  2. The New Family Credit • The provisions to adjust for family size and ability to pay in the current code are redundant and unnecessarily complex New Family Credit

  3. The New Family Credit • Provides tax benefit comparable to current system • Easy computation Step 1: Figure base amount of Family Credit Step 2: Add amounts for children and other dependents Step 3: Subtract the Family Credit from tax due

  4. The New Work Credit • Maintains work incentives comparable to the current system • Credit amount increases as the amount of work income increases • Credit rate and maximum credit is higher for workers with dependents • Simpler structure would be coordinated with Family Credit • Almost all of the eligibility rules and computations flow from Family Credit • Designed to facilitate easy computation for taxpayers or for the IRS to compute on behalf of taxpayers New Work Credit

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