Illinois Should Enhance its Earned Income Tax Credit and Create a Child Tax Credit
Release: February 2, 2022
The Earned Income Tax Credit, or “EITC,” rewards work and reduces poverty by targeting tax relief to low-income families with children. The EITC has become one of the more effective anti-poverty programs in the United States. The reason the federal EITC is so effective is because it is designed as a “refundable” tax credit. When a tax credit is “refundable,” the taxpayer who qualifies to receive it gets the full dollar value of the credit, even if that dollar value exceeds the income tax liability said taxpayer owes. The EITC effectively boosts the earnings of workers who qualify to receive it, thereby increasing their purchasing power and alleviating poverty. The Child Tax Credit (“CTC”) initially provided qualified taxpayers with a $400 per child nonrefundable credit and was intended to provide tax relief to middle-income families. In 2001, the CTC was made refundable, on a limited basis, with a maximum refundable benefit of $600. Its refundability feature also makes the CTC effective at making tax policy fairer, because like the EITC, the CTC functions to offset taxes other than income taxes—like sales, excise and property taxes—which place a disproportionate burden on lower income earners. Illinois currently does not have a CTC at the state level. In addition to alleviating poverty and stimulating the economy, the refundability feature of the EITC also creates a very effective, as well as administratively facile way to make tax burden fairer.
House Bill 174, 96th General Assembly
Release: May 7, 2010
Fact Sheets and Report on House Bill 174 of the 96th General Assembly. This tax reform bill would have implemented a number of changes to Illinois' tax structure including tax increases of the personal and corporate income taxes. Thus, generating new revenue for the state.
Help Struggling Families: Grow the Illinois Earned Income Tax Credit
Release: February 26, 2009
A Fact Sheet on Illinois' state Earned Income Tax Credit, and legislation from the 96th General Assembly that would have increased it.
Top Ten Reasons to Increase the EITC for Working-Poor Families
Release: April 23, 2007
An explanation of the Illinois Earned Income Tax Credit, and why it should be increased.
The Illinois Earned Income Tax Credit: Preserved and Improved in 2003
Release: August 1, 2003
Information on the Illinois Earned Income Tax Credit, and its enhancement in 2003.