Obama Budget Expands EITC for Workers Without Custodial Children
February 11, 2016Print
By Lauren Pescatore and Kate Skochdopole
This week, President Obama stayed true to his word to partner with House Speaker Paul Ryan to provide tax cuts for struggling workers. The president’s final budget proposal includes a plan to increase the Earned Income Tax Credit (EITC) for low-wage individuals without children – the lone demographic that is actually pushed further into poverty by the federal tax code.
Obama’s plan is not only virtually identical to legislation put forward by Speaker Ryan, it has also garnered widespread support from other policymakers and researchers on both sides of the aisle. Currently, these taxpayers receive little or no benefits from the EITC, despite owing income tax before even reaching the poverty line. The president’s proposal would lower the eligibility age from 25 to 21 to encourage employment among younger workers and help 13.2 million Americans find financial security.
The budget proposal also includes a provision to triple the maximum amount of the Child and Dependent Care Tax Credit (CDCTC) to help working families with children under the age of five pay for child care.
The budget proposal is a starting point for compromise, highlighting an area where Republicans and Democrats can agree: the need to help those who are working yet still struggling to make ends meet.
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