Connecticut’s Earned Income Tax Credit (EITC): In a Low-Wage Economy, the EITC is More Important than Ever
Derek Thomas, M.P.A and Ray Noonan – CT Voices for Children
Every job should allow parents to provide food, shelter, and financial security for their children. Connecticut’s Earned Income Tax Credit (EITC) is among the state’s most sensible and effective tools for helping working families struggle to get by on low wages. The refundable tax credit — currently set at 27.5 percent of federal EITC — boosts working families’ paychecks by offsetting their payroll taxes. This proven anti-poverty tool is now at risk, however, as all four budget proposals under consideration at the Statehouse include reductions to the tax credit.
- In 2015, nearly 200,000 low- and moderate-income households received a tax credit from the state EITC.
- The Connecticut EITC boosted about 6,600 people over the poverty line and eased poverty for another 99,000.