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Posts on Federal Budget
September 9, 2020

Rising federal debt should not deter policymakers from enacting additional relief measures to alleviate widespread hardship and keep the economic recovery from losing steam.

COVID-19, the resulting recession, and legislation enacted to fight them are driving federal borrowing and debt to historically high levels, new Congressional Budget Office (CBO) projections show. The budget deficit...

People waiting in physically distanced lines
August 13, 2020

President Trump’s executive action to allow the deferring of payroll tax payments will provide little or no near-term economic stimulus. Meanwhile, its potentially chaotic new rules will create significant compliance burdens for businesses, and workers may not see larger paychecks — and those who do could face surprise tax bills in a few months.

Moreover, permanently cutting payroll...

Person looking concernedly at paperwork
July 22, 2020

The fiscal year 2021 Agriculture appropriations bill that the House will consider this week includes far less funding for SNAP (food stamps) than the program will likely need because it’s based on pre-COVID-19 funding assumptions.

The 2021 risks stem from (1) the uncertainty over the next 14 months (i.e.,...

Grocery Shopping
July 17, 2020

Increasing the federal share of Medicaid costs (the federal medical assistance percentage, or FMAP) would not only protect health coverage during the pandemic and recession, but also increase employment and economic output by providing relief to hard-pressed state...

Man pushing grocery carts
July 16, 2020

In their next economic relief package, policymakers should include a modest but important measure that would temporarily expand the Earned Income Tax Credit (EITC) for tax year 2020 for adults not raising children in their home. This measure, which is in the House-passed Heroes Act, would (1) generate timely, effective fiscal stimulus to help the economy recover, (2) help avoid a poverty spike...

EITC Does Little to Offset Federal Taxes for Low-Income Childless Workers
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Senior Director of Federal Tax Policy

July 14, 2020

This Tax Day, delayed until July 15 to help taxpayers deal with the disruptions caused by COVID-19, should be a wake-up call for policymakers to invest in core government functions like the IRS. A decade of ill-advised funding cuts have constrained not just the IRS’ core function of enforcing taxpayer obligations, but also its capacity to deliver stimulus payments to struggling families during...

Distressed parent at kitchen table with child and pile of bills
July 1, 2020

Unless federal policymakers provide enough aid to states, localities, territories, and tribal governments to offset all or nearly all of their massive revenue losses due to the pandemic, the longstanding inequities from historic and ongoing racism and discrimination — which have left Black and brown communities most harmed by COVID-19 and the economic crisis — will only worsen from the deep...

Postal Worker Making Deliveries
June 29, 2020

Some policymakers are considering whether to make certain business tax credits temporarily refundable — that is, available to firms that don’t have enough taxable income to otherwise qualify — saying that would give cash to struggling small...

Research Credits Mainly Benefit Large Corporations
May 6, 2020

South Dakota’s Governor Kristi Noem says her state doesn’t need more federal fiscal relief; it just needs the Treasury Department to let it use previously provided relief funds to cover revenue shortfalls. The argument apparently has gained traction among some...

Flag and Money
April 21, 2020

Roughly 1 million children may miss out this year on the $500 stimulus payment their parents or guardians are supposed to receive if the parents or guardians don’t complete an online IRS form under an unreasonable deadline, with 600,000 of these children at risk if the form is not filed by noon tomorrow, April 22. This deadline is unreasonable and unnecessary.

The Treasury Department...

Dollar Bill

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