The Year of the EITC? Several States Already Considering Tax Credit Legislation

By Kate Skochdopole

States considered more than 170 bills related to the Earned Income Tax Credit (EITC) during 2016 legislative sessions, and just five days into 2017, this year looks like it will see at least as much activity to expand or reduce the credit.

Advocates and lawmakers in states across the country are setting in motion efforts to create, expand and defend tax credits for workers and families. Although many state legislatures have not yet convened for the new session, EITC debates are already playing out in several states. Here’s a rundown:

  • In Missouri, legislators in the House and Senate have filed bills, HB109 and SB 197, which would create a state EITC worth 20 percent of the federal credit. Missouri State Representative Mike Kelley (R), sponsor of the House bill, will speak on its importance at a community forum next week.
  • Lawmakers in Maryland are considering a bill that would expand the state EITC to workers not raising children and lower the age of eligibility to allow younger workers to benefit from the credit. The Senate Committee on Budget and Taxation will hold a committee hearing on SB 14 on January 18. A companion bill in the Maryland House is being reviewed by the Ways and Means Committee.
  • Advocates in Connecticut will be playing defense as the state assembly reviews HB 5068, a bill introduced by Rep. Robert C. Samuelson (R) that would eliminate the state’s EITC. The state credit was just restored last year to a full 30 percent of the federal credit after being reduced to 25 percent in 2014.

Will the EITC be a hot topic in your state this year? Be sure to check out the Brookings Institution’s “EITC Interactive,” which allows users to filter IRS data on EITC claimants by ZIP code, city, county, metropolitan area, state legislative district and more. Providing state legislators with data on how many taxpayers in their districts claim the federal EITC can be an especially effective way to convey the importance of a state-level EITC to their constituents.

As the 2017 EITC campaigns continue to roll out, be sure to follow TCWF on Twitter for up-to-the-minute updates on state-level tax legislation.