Senior Director of Federal Tax Policy
What do you call parents who work at very low-wage jobs to support their families — say, a single mother raising two children and working at a nursing home, or a construction laborer trying to support his wife and children? Until recently, policymakers have called them welfare-reform success stories: people who have chosen work over welfare. Now, however, there is a risk that it is becoming fashionable to call them “freeloaders” for whom the Internal Revenue is a “sugar daddy” dispensing tax benefits.
Here’s the issue: a significant number of low-wage workers with children qualify for an earned income tax credit (EITC) and a child tax credit whose combined value exceeds what they pay in federal income and payroll taxes. Some critics are using this fact to argue for cutting the EITC and child credit, both of which received temporary expansions in last year’s Recovery Act. Those critics need to consider the following realities:
Low-wage working parents aren’t “freeloaders” sitting home on the couch eating potato chips. These people are working to make ends meet for their families — on wages that often don’t make that possible. We should help them succeed.