Earned Tax Credit Policy Analysis

Income Tax Credit”. For the most part, it seems as though the general public is under

It is not enough to provide material relief to those experiencing extreme deprivation(158). Therefore the federal government should establish and create opportunities for the poor to gain and maintain their citizenship in standard living. According to the book, "$2.00 a Day" writer Kaitlyn Edin emphasize one have the strong will to work but opportunities lack extremely, in which concede the fact that there aren't enough jobs with adequate pay, hours, and stability to go around(159). On one hand, I agree with Edin that the will of the poor is there, but the federal government should play more substantive role in getting individuals jobs.For instance, stated in the book, “In-depth interviews with 209 EITC claimants in the Northeast and Midwest in 2007 showed that while TANF receipt confers stigma and shame, claiming the EITC gives people dignity and restores their pride”(172). Also the federal government need to restore relationships in the workplace, increase wage, and prevent wage theft . For example, a successful grocery store called Market Basket located in New England starts employees off at twelve dollars an hour, offer health insurance, and paid sick to all employees(164). Creating better jobs and opportunities is the government role as it is our role to maintain a job and contribute as

Great discoveries always begin with great questions. Barbara Ehrenreich asked two great questions, “how does anyone live on the wages available to the unskilled” and “how were the roughly four million women about to be booted into the labor market by welfare reform, going to make it on $6 to $7 an hour” (2001, p. 12). To answer the questions, Ehrenreich embarked upon a journey to discover for herself, whether she could match income to expense as a low-wage worker. In effect, Ehrenreich tested the fundamental premise of The Personal Responsibility and Work Opportunity Reconciliation Act, also known as welfare reform, in order to determine whether those individuals formerly on welfare and largely unskilled, could earn a living wage on the

including the Earned Income Tax Credit ( EITC) and the Child Tax Credit ( CTC) that directly

One of the major problems that this act of legislation causes economically is an unequal taxation of different groups based on their income. Those who make $400,000+ are taxed a rate of 39.6% of their total income. (H.R 8, 112th Congress) This does not incorporate sales tax and property taxes that are also taken each year as well. In the book “Economics in One Lesson” by Henry Hazlitt, one topic that is discussed is how taxes discourages production. In the case of The American Taxpayer Relief Act of 2012, those who are of working class category will not see a change in their tax rates. This is great since the monetary funds that they do not pay in taxes they can either invest or use in the market. However, the taxes for those who are of upper class status have the burden. As Hazlitt

Introduced in July 2012, H.R. 8, the Job Protection and Recession Prevention Act of 2012, sponsored by Representative Dave Camp of Michigan, was approved by the House of Representatives in August 2012 and forwarded to the Senate for consideration. Opponents of H.R. 8 maintain that the plan does not provide tax cuts for all American taxpayers while supporters on both sides of the aisle argue that these changes to the Internal Revenue Code are needed to sustain the nation's economic recovery and prevent another recession. To determine the facts in the debate over H.R. 8, the Job Protection and Recession Prevention Act of 2012, this paper provides a review of relevant governmental and media sources, followed by a summary of the research and important findings in the conclusion.

Temporary Assistance for Needy Families (TANF) is a program that helps struggling parents with children become more independent by getting more work experience and training while getting cash benefits, and eventually getting a paying job without as many cash benefits. The main goal of TANF is to help poor families stop relying on welfare benefits so they can become integrated into the workforce and economy. However, TANF is a very controversial subject because it has not been as effective in practice as the Aid to Families with Dependent Children (AFDC), the welfare program that TANF replaced. This change in program effectiveness is significant to the United States as well as it’s economy because TANF is not helping as many people as the

They also are not supporting a family so they don’t need to make the amount of money men make.” The mindset should be “Women can work most of the same jobs as men and therefore should be given the same pay and same benefits.” Another road block that seemed to unintentionally keep women from workplace equality was that the New Deal policies didn’t do much to redefine or bring up the idea of furthering equal pay or

Here are the 2010 tax year income limits, maximum EITC amount and the EITC-related tax law changes. You can also access the information for: * Preview of 2011 Tax Year * 2009 Tax Year  * 2008 Tax Year * 2007 Tax YearReturn to EITC Home Page2010 Tax YearEarned Income and adjusted gross income (AGI) must each be less than: * $43,352 ($48,362 married filing jointly) with three or more qualifying children * $40,363 ($45,373 married filing jointly) with two qualifying children * $35,535 ($40,545 married filing jointly) with one qualifying child * $13,460 ($18,470 married filing jointly) with no qualifying

(2015). “Dignity and Dreams What the Earned Income Tax Credit (EITC) Means to Low-Income Families.” they use interview method to analysis their research. They are interview 115 EITC recipients from different race and ethnicity; for instance, white, black, and Hispanic, filing status (married and single) who received EITC refund at least $1,000 and examine how recipient attitude about the EITC and also how they spend it. In “Labor Supply Response to the Earned Income Tax Credit,” Eissa, Nada and Jeffrey B. Liebman (1996). They use the population survey of annual demographic file of approximately 57,000 house hold from 1985-1989 to 1989- 1991. The sample includes unmarried females such as widowed, divorced and never married which are between 16 and 44 years old. This data did not include any females who separated from her spouse or who was ill during the reference

Edin and Lein wanted to discover the surviving strategies of single mothers who are on welfare or work on a low-waged job. They argue “neither welfare nor low wage work gives single mothers enough income to meet their families’ expenses” (253). To find out the set of survival strategies of single mothers to make ends meet Edin and Lein interviewed 379 low income single mothers. They chose their interviewees from different cities, different aged group, and different ethnic background. Most mothers who are on welfare wanted to find a job and be out of the welfare but the primary problem that single mothers face was that “family economics”. With the minimum wage income it was impossible for the single mothers to bring the ends meet. Neither working nor being on welfare was enough to survive therefore mothers who are on welfare supported their budget by generating substantial supplementary income. Edin and Lein states that “welfare recipients generated extra income by working at side jobs, obtaining cash from network members, community groups and local charities”. They also get cash help from the family members, child’s fathers, and from a boyfriend. Because they were afraid to lose welfare benefits they did not tell anyone about the extra income they have. To survive they needed both the welfare benefits and the extra income. It was very difficult to establish a trust with the interviewees in the beginning because they were afraid if they talk about it they might lose the

The Earned Income Tax Credit (EITC) is a program that was set in place, in 1975, to improve “the economic status of low-income persons […] granting nearly $40 billion to low-income households” (Borjas, 59). As is clear from the name of the program, The EITC is a program that provides tax credits to those who qualify, the EITC could even produce a negative tax liability for some households, in particular the type I will discuss, which would provide substantial income increases for these households. In order to qualify for the EITC, the recipients must be active members of the labor force, in that they must have labor income, and for the group that I will be focusing on, single mothers, total household income must be below $33,241 for single

The distinctions of these test are important because, in addition to being a tax-saving exemption, “a qualifying child also factors into claims for head of household status, the child tax credit, the child and dependent care credit, the exclusion from income for dependent care benefits and the Earned Income Tax Credit, or EITC” (Bell, 2011). If taxpayers only follow the guidelines of these test, it would have prevented the Protecting Americans from Tax Hikes (PATH) Act of 2015.

The introduction of workfare to work policy arguably centres around societal integration of the marginalized, which could greatly benefit welfare recipients. If implemented effectively it would provide the opportunity for underclass citizens to secure a job and therefore a steady income. The basis of the program is to decrease transient employment, and aid in job search as well as skills building in hopes of bringing more individuals and families above the poverty line. Workfare programs in the United States have centred around providing the opportunity to “fast track” into the labour market with the help of social services such as counselling, group activities, job searching, skills training, educational opportunities and subsidized volunteer

The impetus behind the tax credits appears to be two-fold. As taxpayers work to improve energy efficiency, decreasing usage, and lessening the environmental impact of their daily activities, they may receive financial rewards based on their actions.