Vice President for State Fiscal Policy
As states continue to turn the corner on the Great Recession, policymakers in a number of states are looking to help low-paid working families by creating or expanding refundable state earned income tax credits (EITCs). These credits build on the federal EITC, which promotes work, helps families make ends meet, lifts them out of poverty, and yields lasting benefits for kids, studies show.
States considering EITC expansions include:
States considering new EITCs include:
A number of states improved their credits in 2014, as our updated paper explains. Most notably, the District of Columbia expanded the EITC for workers without dependent children in the home, an idea with bipartisan support at the federal level. Twenty-five states plus the District of Columbia have EITCs (see map).
States are smart to use one of our most effective tools to ensure working families recover along with the economy. State EITCs allow state lawmakers to leverage the power of the federal credit at a relatively low cost.