Portman, Brown announce EITC, CTC expansions
As the Senate and House consider tax extenders legislation, U.S. Sen. Sherrod Brown announced earlier this week that the package will include his proposal to permanently extend expansions of the Earned Income Tax Credit (EITC) and the Child Tax Credit (CTC) – two of the most important anti-poverty credits for working families.
“Many Americans work hard but struggle each day just to provide for themselves and their family. Without a doubt, there is no greater boost for these families than the Earned Income Tax Credit and the Child Tax Credit,” Brown said.“Together, these credits are a lifeline for working families, lifting millions out of poverty, providing an incentive to work, and putting more of the money they’ve earned in their pockets. By permanently extending these programs we can help those most in need and protect this benefit for the millions of hardworking tax payers nationwide.”
Brown has been the Senate’s lead advocate for the EITC and CTC and has pushed to prevent making certain business tax provisions permanent without also making EITC and CTC permanent. In March, Brown introduced the Working Families Tax Relief Act, which would extend and expand the Earned Income Tax Credit and the Child Tax Credit.
Without an extension of the EITC and CTC by 2017, approximately 50 million Americans would lose all or part of their EITC or CTC. The Brown-Durbin bill has attracted 44 cosponsors including Senate Finance Committee Ranking Member Ron Wyden (D-OR) and eight other members of the Finance Committee, plus six members of Democratic Leadership, including Minority Leader Harry Reid (D-NV).
The EITC is a refundable tax credit for low-income Americans that encourages work and helps families make ends meet. In 2012, more than 24 million taxpayers received a lump sum refundable credit through EITC after filing their taxes. The CTC is available for taxpayers with children in the amount of up to $1,000 per child under age 17. Without an extension of the EITC and CTC by 2017, over 13 million families would lose all or part of their EITC or CTC and 16.4 million people would be pushed into poverty or deeper into poverty.
U.S. Senator Rob Portman (R-Ohio), a member of the Senate Finance Committee, applauded the inclusion of provisions in the year-end tax extenders bill that make expansions of the Earned Income Tax Credit (EITC) and Child Tax Credit (CTC) permanent and provide for improved program integrity for both incentives.
“The EITC and CTC are two of the most effective tools we have to encourage work and fight poverty,” Portman said. “These pro-work, pro-family incentives increase work’s rewards, and the Congressional Budget Office has said that the EITC encourages more households to enter the workforce. I was also pleased to see that key provisions to prevent improper payments within these programs was added to the legislation.
“With improper payment rates of close to 25 percent for both credits, it was essential to preserve the integrity of these programs so that they are available to those who truly need them. By making these anti-poverty expansions permanent, low-income workers will have more certainty that they will be able to afford that next rent check or bag of groceries.”
In 2012, 982,000 Ohio households received the EITC and 649,000 households received the low-income part of the CTC. Making the expansions permanent will ensure that 778,000 children in 407,000 Ohio families will not lose some or all of their working-family tax credits.
Lisa Hamler-Fugitt, executive director for the Ohio Association of Foodbanks, also released the following statement regarding the announcement:
“The bipartisan agreement reached late yesterday is a promising and hopeful demonstration of the power of policies that respond to the needs of everyday Americans. We are deeply thankful to our congressional delegation for leading the charge on protecting and strengthening critical funding for programs that help the most vulnerable among us.
“We want to especially thank Senator Sherrod Brown and Senator Rob Portman and members of Ohio’s congressional delegation for their support of making expansions of the Earned Income Tax Credit and Child Tax Credit permanent and extending several tax provisions that will support charitable giving and foodbank donations. By making improvements to these credits permanent, Congress has committed to strengthening low-income working families and combatting poverty. This legislation will help keep more hard-earned money in the pockets of Ohio families.
“Additionally, the spending package includes an increase in funding for national service programs administered by the Corporation for National and Community Service. As the home of one of Ohio’s largest national service programs, we are thrilled that Congress recognized the incredible return on their investment in these programs, which put ‘boots on the ground’ to fight poverty and strengthen local communities.
“We look forward to carrying this bipartisan momentum into the new year and thank Ohio’s congressional delegation for coming together to support families this holiday season.”