Economic Opportunity for All Campaign Basic necessities consume a larger portion of income for low-income individuals and families than those earning higher incomes
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Progressive tax policy can and should help people with lower incomes keep more of what they earn and provide incentives to earn more so as to help them lift themselves out of poverty
Low-income tax credits help increase income
Earned Income Tax Credit
Child Tax Credit
Promoting savings helps by giving people an incentive to try and build assets
Individual Development AccountsTax Policies Can Reduce Poverty and Create Economic Opportunity
Designed to offset payroll taxes and “reward work” for those in low-income jobs (began in 1975)
Source: Center for Budget & Policy Priorities
Without ARRA, the increased EITC for families with three or more children would not exist. Also, the incomes where the EITC “phases out” (i.e. decreases) for married couples filing a join tax return would be lower. These changes ensure that many low-income families will get a higher EITC and more incentive to find and maintain work.
Increase the EITC for persons without children (or children in the household)
S. 22/H.R. 536: Strengthen the EITC Act
Makes EITC changes from the ARRA permanent (expanded EITC for married couples and larger families)
S. 985/H.R. 2277: Savings for Working Families Act
Expands IDA program and financial literacy training
Could allow up to 2.7 million people to participate in IDA programs
S. 722: Taxpayer Certainty and Relief Act of 2009
Makes the EITC expansion for married couples and large families permanent; make $3,000 CTC threshold permanent
Currently, none of these bills are moving forward in Congress. However, tax reform is anticipated to be a high priority in 2010. This is the year that the 2001 and 2003 Bush tax cuts are set to expire. It is very important that any tax reform enacted include changes to the tax code that benefit low-income individuals and families.
Inform: First, low-income single workers without children receive such a low EITC, some end up paying a large tax bill even after receiving the credit. Also, recent expansions to the EITC and Child Tax Credit that have helped millions of low-income families are only temporary. For example, 26 million low-income children and their families will lose all or part of their Child Tax Credit in 2011 under current law. The CTC also still remains unavailable for America’s poorest families.
RESULTS/RESULTS Educational Fund 750 First St NE, Ste 1040Washington DC 20002RESULTS Economic Opportunity Campaign Contacts:Meredith Dodson, firstname.lastname@example.org, (202) 782-7100, x116Jos Linn, email@example.com, (515) 288-3622Alan Gold, firstname.lastname@example.org, (202) 783-7100, x106