Minnesota Expands EITC
Minnesota Governor Tim Walz (DFL) recently signed legislation to increase the state’s Earned Income Tax Credit (EITC), known as the Working Family Credit (WFC) as part of a broader tax package.
Unlike other state credits, the WFC is structured as a percentage of a worker’s earned income, not as a percentage of the federal EITC. The value of the credit decreases after a taxpayer’s earned income passes a certain threshold, which is based on number of qualifying children. Previously, the highest threshold was for families with two or more dependent children. The new legislation creates a fourth tier for families with three or more dependent children and increases the credit’s income thresholds for the existing three tiers (no qualifying children, one qualifying child, and two qualifying children.) The legislation also increases the credit value and qualifying income level for workers without dependent children.
To learn more about Minnesota’s Working Family Credit, as well as other state-level EITCs across the country, visit our 50-state map here.