Washington, D.C. — Today, Sens. Sherrod Brown (D-OH), Michael Bennet (D-CO), Ron Wyden (D-OR), and Dick Durbin (D-IL), along with 44 co-sponsors, introduced the Working Families Tax Relief Act, which would expand the earned income tax credit (EITC) and child tax credit (CTC). If enacted, this legislation would boost economic security for 44 million households and bring approximately 28 million people above or closer to the poverty line. Following the bill’s introduction, Neera Tanden, president and CEO of the Center for American Progress, released the following statement:
This is what tax reform that actually benefits the American people looks like. Across the country, Americans are working harder than ever but are falling further and further behind—stuck between stagnant wages and rising costs. At a time when more than 40 percent of U.S. households are struggling to afford basics such as food, housing, health care, and child care, and an estimated 70 percent of Americans reported facing at least one serious hardship within the past year, expanding the EITC and the CTC would dramatically reduce poverty while helping millions of families weather the squeeze between flat wages and the rising costs associated with reaching and staying in the middle class.
It is especially fitting that this proposal comes just days before the first Tax Day governed by the Trump administration’s new tax rules. In contrast to President Donald Trump’s unpopular tax law—which rewrote the tax code in favor of yacht owners and wealthy corporations—I am thrilled to see Sens. Brown, Bennet, Wyden, and Durbin introduce legislation that would actually benefit the “forgotten men and women” Trump claimed he would fight for during his 2016 campaign.
The Working Families Tax Relief Act is the second in a pair of tax bills introduced by congressional Democrats in recent weeks. The legislation would, for the first time, provide a substantial EITC to struggling workers without dependent children—the only group currently taxed into or deeper into poverty. Like the American Family Act, the bill would make the CTC fully refundable so that the lowest-income families are no longer left out. The Working Families Tax Relief Act would also create a new monthly young child tax credit for families with children under age 6—an idea originally introduced in a 2015 CAP report. Furthermore, the bill would help families avoid predatory payday loans by allowing them to access up to $500 of their EITC starting halfway through the tax year to help offset unexpected expenses or financial emergencies, a proposal set forth by CAP in 2014. Together with the American Family Act, the Working Families Tax Relief Act would cut child poverty in half.
- Harnessing the EITC and Other Tax Credits to Promote Financial Stability and Economic Mobility by Rebecca Vallas, Melissa Boteach, and Rachel West
- How Predatory Debt Traps Threaten Vulnerable Families by Joe Valenti and Eliza Schultz
- Harnessing the Child Tax Credit as a Tool to Invest in the Next Generation by Rachel West, Melissa Boteach, and Rebecca Vallas
- Op-ed: Trump’s tax law expanded the child tax credit to the wealthy, and left 26 million children behind by Rep. Rosa DeLauro (D-CT) and Neera Tanden
For more information or to speak to an expert, contact Julia Cusick at gro.ssergorpnacirema@kcisucj or 202-495-3682.