Requests: the Earned Income Tax Credit and Child Tax Credit

2015 U.S. Poverty Campaigns

Protecting the EITC and CTC

Remember what you’ve learned about the EITC and CTC…

EITC and CTC: Effective Anti-Poverty Programs

The EITC and CTC are our best defense against an unfair tax system that favors the wealthy.

These credits have time and again proven their effective-ness, together lifting 9.4 million people out of poverty in 2013.

Save the EITC and CTC Expansions!

• The critical expansions made in 2009 are SET TO EXPIRE in 2017 if Congress fails either to extend them or make them permanent.

• If these key provisions are allowed to expire, 16.4 million people could fall into or deeper into poverty, including 7.7 million children.

• Meanwhile, Congress is considering extending tax breaks to benefit large businesses that will cost about $700 billion dollars over ten years.

http://www.cbpp.org/research/letting-key-provisions-of-working-family-tax-credits-expire-would-push-16-million-peoplehttps://www.nationalpriorities.org/blog/2014/04/07/congress-extend-corporate-tax-breaks-not-unemployment-benefits/

EITC and CTC LegislationS.1012: The Working Families Tax Relief Act of 2015, introduced by Senator Sherrod Brown (D-OH)

o Makes the 2009 EITC and CTC provisions permanent

o Expands the EITC for childless workers

o Lowers EITC eligibility age for childless workers from 25 to 21

H.R.902:The Earned Income Tax Credit Improvement and Simplification Act of 2015, introduced by Rep. Richard Neal (D-MA-1)

o Makes 2009 EITC improvements permanent

o Expands EITC for childless workers (similar to S.1012)

H.R. 1286: The Child Tax Credit Permanency Act of 2015, introduced by Rep. Rosa DeLauro (D-CT-3)

o Makes 2009 CTC improvements permanent

o Indexes the CTC $1,000 per child credit to inflation following the year 2013

2015 EITC and CTC Requests• Ask members of Congress to speak to tax leaders, urging

them to:

• Save key components of the EITC and CTC by making 2009 ARRA improvements permanent.

• Fix the glaring gap by expanding the EITC for childless workers.

• These components should be key in any discussions of comprehensive tax reform

• Urge your members of Congress to show support for working families by cosponsoring S.1012, H.R.1286, and H.R.902.

The Big Players: Senate

Senate Finance Committee Chairman Orin G. Hatch (R-Utah)

Ranking Member Ron Wyden (D-Oregon)

The Big Players: House of Representatives

House Committee on Ways and Means Chairman Paul Ryan (R-Wisconsin)

House Committee on Ways and Means Ranking Member Sander M. Levin (D-Michigan)

Engage: The Earned Income Tax Credit (EITC) and Child Tax Credit (CTC) help hardworking families make ends meet; they lifted 9.4 million people out of poverty in 2013, including 5 million children.

EITC and CTC Laser Talk(for skeptics)

Problem: Despite the success of these pro-work tax credits, 16 million Americans, including 7.7 million children, could fall into or deeper into poverty if Congress does not save key EITC and CTC provisions.

EITC and CTC Laser Talk(for skeptics)

Inform/Illustrate: Let me tell you my story/a story about the impact of these tax policies… The EITC and CTC promote work and help working families escape poverty, while making a big impact on the lives of children. In addition, House Ways and Means Committee Chairman Paul Ryan (R-WI) wants to fix a glaring gap by expanding the EITC for low-income workers without children.

EITC and CTC Laser Talk(for skeptics)

Senate Call to Action: Will you personally speak to Senate Finance Committee Chair Orrin Hatch (R-UT) and/or Ranking Member Ron Wyden (D-OR), urging them to make saving the EITC and CTC provisions their top tax priority this year?

Note: the request to cosponsor S. 1012 is NOT in your “leave behind” – but still good to reiterate that you would like Democratic Senators to support it.

EITC and CTC Laser Talk(for skeptics)

House Call to Action: Will you speak to House Ways and

Means Committee Chair Paul Ryan (R-WI) and/or Ranking

Member Sander Levin (D-MI), urging them to make saving the

EITC and CTC provisions their top tax priority this year?

In addition, will you co-sponsor the Child Tax Credit

Permanency Act (H.R.1286) and the Earned Income Tax Credit

Improvement and Simplification Act (H.R.902), if you haven’t

done so already? These bills support working families by

saving the expiring EITC and CTC provisions and fix the gap in

the EITC for workers without children.

Note: the request to cosponsor H.R. 1286/H.R. 902 is NOT in your “leave behind” – but urge House Democrats to cosponsor if they haven’t already.

EITC and CTC Laser Talk(for skeptics)

Engage: The Earned Income Tax Credit (EITC) and Child Tax Credit (CTC) are pro-work, effective anti-poverty programs; they lifted 9.4 million people out of poverty in 2013, including 5 million children.

EITC and CTC Laser Talk (for allies)

Problem: Important provisions made to the EITC and CTC in the 2009 American Recovery and Reinvestment Act are set to expire in 2017, thus forcing 16 million people, including 8 million children, into or deeper into poverty.

EITC and CTC Laser Talk (for allies)

Inform: The EITC and CTC have many benefits. They encourage work, improve academic and health outcomes in children, and keep families out of poverty. However, a glaring gap in the EITC exists between workers with children and those without children in the home. This latter population receives an maximum EITC so small, they are the only group taxed into poverty.

EITC and CTC Laser Talk (for allies)

Senate Call to Action: Will you speak to Senator Finance Committee Chair Orrin Hatch and Ranking Member Ron Wyden to urge them to save the 2009 improvements to the EITC and CTC by making them permanent, and fixing the glaring gap by expanding the EITC for childless workers?

In addition, will you show your support for working families by co-sponsoring the Working Families Tax Relief Act of 2015, S.1012, if you haven’t done so already? This bill supports working families by making the EITC and CTC provisions permanent and expanding the EITC for workers without children.

EITC and CTC Laser Talk (for allies)

House Call to Action: Will you speak with House Ways and Means Committee Chair Paul Ryan and Ranking Member Sander Levin to urge them to save the 2009 improvements to the EITC and CTC by making them permanent, and fixing the glaring gap by expanding the EITC for childless workers?

In addition, will you show your support for working families by co-sponsoring the Child Tax Credit Permanency Act (H.R.1286) and the Earned Income Tax Credit Improvement and Simplification Act (H.R.902), if you haven’t done so already? This bill supports working families by making the EITC and CTC provisions permanent and expanding the EITC for workers without children.

EITC and CTC Laser Talk (for allies)

Why make these provisions permanent given the EITC’s high error rate? 

We agree wholeheartedly that the EITC’s error rate needs to be reduced. But it’s important to keep in mind that:  o The error rate mostly reflects unintentional error caused by the

intersection of quite complex EITC rules (designed to target the credit appropriately) and often-complex family situations, especially in the case of separated, divorced, and multiple-generation families.

o The Treasury Department has made a number of specific proposals to Congress to reduce the errors, which should be considered as part of any legislation to make permanent the expiring tax-credit improvements.

Some Potential Objections

Some Potential ObjectionsWhy isn’t the focus on raising the minimum wage instead? 

This isn’t an either/or proposition. Both the tax credits and the minimum wage — which has lost considerable ground to inflation and needs to be raised to make up the lost ground — are successful policy levers that complement each other well. For example, the EITC and CTC adjust for the number of children in a family, while the minimum wage does not. In addition, the EITC and CTC are delivered through a tax refund that comes once a year and can be used for large, one-time expenses such as a repairing a roof or car or paying a security deposit; the minimum wage is reflected in every paycheck, helping families meet routine bills as they arise.

Helping Families: An EITC/CTC Story

• Georgette supports herself and her children in the Twin Cities, Minnesota.

• A sudden, unexpected termination of her lease led to unstable housing and the majority of Georgette’s savings wiped away.

• EITC and CTC paid the security deposit on her new apartment, paid some bills, and rebuilt her savings account.

• Her tax refund not only allowed her to secure housing after experiencing homelessness, but also brought her scattered family under one roof again.

Source: Prepare and Prosper (Minnesota)

“Let us recognize that extreme poverty anywhere is a threat to human security

everywhere. Let us recall that poverty is a denial of human rights. For the first

time in history, in this age of unprecedented wealth and technical prowess, we

have the power to save humanity from this shameful scourge. Let us summon

the will to do it."  - former UN Secretary General Kofi Annan