Data Snapshot: EITC Continues to Reach Families in Poor Places

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Key Findings

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The Earned Income Tax Credit provides tax relief to working people with low to moderate income, with much larger credits for tax filers with children. The credit is refundable, meaning that the EITC reduces the amount of tax owed, and any amount above that may be issued as a refund.

Summary

Recent proposals in the House and Senate (for example, the Grow American Incomes Now Act) focus on amplifying the Earned Income Tax Credit (EITC)—a refundable tax credit for low-income workers—to compensate for growing wage inequity. We find that the share of EITC filers who are families with children is especially high in the poorest counties (those counties outlined in black on Map 1), including many places throughout the South. 

Many of these counties are nonmetropolitan counties (see Map 2), suggesting that the EITC can provide safety net support in places where other social services may be less available. While an EITC expansion could be costly, existing research shows that its effects on poverty reduction, employment, and both children’s health and achievement are considerable, and therefore, worth considering in the scheme of ongoing broad tax revisions.

Map 1.
 

 

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About the Author(s)

Andrew Schaefer
Andrew Schaefer is a Vulnerable Families Research Scientist at the Carsey School of Public Policy. Andrew joined Carsey in May 2010 as a research assistant on the Vulnerable Families research team. Much of his work at Carsey focuses on poverty, the social safety net, and women and work, including policies and programs that support low-income and other working families. Andrew is currently working on projects exploring counties with high child poverty and the economic conditions of immigrants in rural places. Read More...
Beth Mattingly
Beth Mattingly is director of research on vulnerable families at the Carsey School of Public Policy. She manages all of Carsey’s policy relevant work relating to family well-being. Topics covered by the vulnerable families research team range from refundable tax credits, Supplemental Nutrition Assistance Program (SNAP) and other federal programs, as well as policies that help families balance the domains of work and family like access to affordable child care and paid sick leave. Her interests center on women, children, and family well-being. Read More...
Kennedy Nickerson
Kennedy Nickerson graduated from the University of New Hampshire’s Carsey School of Public Policy with a Master’s in Public Policy in 2017. Read More...
Jessica Carson
Jess Carson is a Research Assistant Professor with the Vulnerable Families Research Program at the Carsey School of Public Policy. Since joining Carsey in 2010, she has studied poverty, work, and the social safety net, including policies and programs that support low-income workers like affordable health insurance, food assistance programs, and quality child care. Her other interests include health within and across families, and the intersection of health and employment across the income spectrum. Jess is also working on a long-term project around the challenges and opportunities facing people who live and work in rural communities, with the goal of highlighting the strategies that work best to support them. She has a Ph.D. in sociology from the University of New Hampshire. Read More...