WASHINGTON, D.C. - On the heels of Tax Day 2013, U.S. Senators Sherrod Brown (D-OH) and Dick Durbin (D-ILL) introduced legislation today that would permanently enhance critical refundable tax credits that help keep millions of working families out of poverty. They were joined in cosigning the bill with Senate Finance Committee Chair Max Baucus (D-MT). In total, 27 members of Congress are co-signers, including 10 from the Senate Finance Committee. The Working Families Tax Relief Act of 2013 makes permanent provisions of the American Tax Payer Relief Act that are set to expire after only five years, and strengthens and expands the eligibility of the Earned Income Tax Credit (EITC) and enhance the Child Tax Credit (CTC).
“This is about ensuring that Americans who work hard and play by the rules can take home more of their pay each month while taking care of their children,” Brown said. “Enhancing the earned income tax credit should be a bipartisan goal, as President Reagan called EITC the most effective tool in fighting poverty. We need to reward Americans who work hard and play by the rules and ensure that they can work and continue to take care of their families. I’m glad to be joined by Senate Finance Committee Chair Max Baucus and eight other members of the committee in introducing this legislation. Their support is a testament to the bill’s significance and increases its likelihood for passage.”
“This bill is pro-family, pro-work legislation that would permanently extend critical refundable tax credit provisions that have helped lift millions of working families out of poverty,” Durbin said. “The Child Tax Credit and the Earned Income Tax Credit encourage work, help families make ends meet, and lead to healthier and better educated children. I look forward to working with Senator Brown and many of my colleagues to ensure that these critical provisions are included in tax reform.”
The EITC is a refundable tax credit that encourages work, helps families make ends meet, and leads to healthier, better educated children. In 2012, more than 27 million taxpayers received nearly $62 billion in EITC benefits. In 2011, according to the Internal Revenue Service (IRS), the EITC lifted 6.6 million Americans out of poverty, 3.1 million of whom were children – with the average EITC family claiming an average of $2,200. But in contrast to the EITC for working families with children, the EITC for workers without children remains extremely small — too small even to fully offset federal taxes for workers at the poverty line. Under current law, a childless adult or noncustodial parent working full-time at the minimum wage is ineligible to receive any EITC benefits. Such an individual would receive the maximum EITC if he or she had children. As a result, low-wage workers not raising minor children are the only Americans taxed into poverty.
To fix this problem and help American taxpayers save more money, the Working Families Tax Relief Act of 2013 would:
A coalition of 300 organizations nationwide wrote a letter to Brown and Durbin in support of the Working Families Tax Relief Act of 2013 and its efforts to preserve and strengthen the EITC. The letter can be read in its entirety HERE.