off the charts
POLICY INSIGHT
BEYOND THE NUMBERS

Key Tax Credits Lift Millions of Mothers and Children Out of Poverty

With Mother’s Day approaching, 21 million mothers are benefiting from two key tax credits for low-income workers — the Earned Income Tax Credit (EITC) and the Child Tax Credit (CTC).  These credits lifted 2.1 million mothers and 5 million children out of poverty in 2013 (the most recent year available), using a Census Bureau poverty measure that counts tax credits and government benefits.

Our new fact sheet gives state-by-state figures on how many mothers in working families benefit from the EITC and CTC.

The EITC and CTC not only help working parents make ends meet:  a growing body of research suggests that children in families receiving the credits have improved health, perform better in school, are likelier to attend college, and can be expected to work and earn more as adults (see graphic).

But unless Congress acts, key EITC and CTC provisions will expire at the end of 2017.  The stakes for working moms are high: 10 million mothers, and 25 million children in working families, would lose all or part of their EITC, CTC, or both.  Many low-income working moms would lose their entire CTC.  For example, a single mother with two children working full time in a nursing home for the minimum wage and earning $14,500 would lose her entire CTC of $1,725.  

That’s why it’s critical for working mothers — and their families — that Congress make the key EITC and CTC provisions permanent.

Further, states can help moms and kids by creating and strengthening state EITCs.  State EITCs build on the federal tax credits by helping working parents, while making sure state tax codes treat low-wage mothers more fairly.  Like the federal EITC, state EITCs make kids healthier and help them do better and go further in school.

For more, see our chart book on the EITC and CTC.