Warner, Kaine back working families tax relief

U.S. Senators Mark Warner, a member of the Senate Budget, Finance and Banking, Housing & Urban Affairs Committees, and Tim Kaine, a member of the Senate Budget and Health, Education, Labor, and Pensions (HELP) Committees, joined U.S. Senator Sherrod Brown and 42 of their colleagues to reintroduce legislation to expand two anti-poverty tax credits to benefit workers and families in Virginia.

The Working Families Tax Relief Act seeks to increase both the accessibility and value of the Earned Income Tax Credit (EITC) and Child Tax Credit (CTC), and ensure that workers will not be taxed into poverty.

“The Earned Income Tax Credit and the Child Tax Credit help millions of working people and families who work long hours to make ends meet,” said Warner. “Expanding these tax incentives will encourage and reward the hard work of a broad swath of people, including childless workers, and support working families by lifting them out of poverty.” 

“The Earned Income Tax Credit and Child Tax Credit have been critical in helping families pay the bills and lifting children out of poverty,” Kaine said. “This bill expands access to the EITC and CTC by simplifying the process to apply and strengthening the credits for folks who need it most. Hardworking Virginians, who sometimes juggle multiple jobs to make ends meet and care for their children, don’t deserve to be taxed into poverty.”

The Working Families Tax Relief Act would do four things:

1. Expand EITC for Childless Workers: Workers who don’t claim children are the sole group that the federal tax system can tax into poverty or deeper into poverty. There is a small credit for workers not raising children in the home, but the maximum credit amount is $510 and the credit begins to phase out at $8,340 and phases out completely at $15,010. In addition, all workers that do not claim children and are younger than 25 are ineligible for the EITC. The result is that the EITC for a full-time, minimum-wage worker not claiming children is $27 – making workers who do not claim children the only group of taxpayers that can be taxed into poverty. The Working Families Tax Relief Act reduces the age limit to qualify for the EITC from 25 to 21 and expands the size of the credit so the same full-time, minimum wage worker would earn a refundable credit of approximately $913.
2. Strengthen the Child Tax Credit for Families with Young Children: The bill builds on the proven success of the CTC to lift children out of poverty. The legislation will focus on the most vulnerable children by allowing taxpayers to claim a refundable credit equal to 45 percent of each dollar earned up to a maximum credit of $3,000 per child under six years of age.
3. Index the CTC to inflation: A recent study from Columbia University concluded that if the CTC is not indexed, 750,000 children under 17 and their families will fall below the poverty line by the end of the decade. This bill would index the maximum CTC and the income thresholds at which the credit begins to inflation.
4. Make it easier to claim the EITC: This bill includes a pair of bipartisan measures, originally proposed by the George W. Bush Administration, designed to simplify and clarify who can claim a child. The first proposal simplifies the complicated rules for how parents who are separated can claim the EITC. The second proposal allows filers who live with a qualifying child, but do not claim the child for the EITC, to claim the childless EITC proposed in the bill.

The Working Families Tax Relief Act was introduced by Brown (D-OH) and co-sponsored by Warner and Kaine as well as U.S. Senators Dick Durbin (D-IL),  Michael Bennet (D-CO), Chuck Schumer (D-NY), Ron Wyden (D-OR), Pat Leahy (D-VT), Dianne Feinstein (D-CA), Patty Murray (D-WA), Jack Reed (D-RI), Bill Nelson (D-FL), Tom Carper (D-DE), Debbie Stabenow (D-MI), Maria Cantwell (D-WA), Robert Menendez (D-NJ), Ben Cardin (D-MD), Bernie Sanders (I-VT), Bob Casey (D-PA), Claire McCaskill (D-MO), Amy Klobuchar (D-MN), Sheldon Whitehouse (D-RI), Jon Tester (D-MT), Tom Udall (D-NM), Jeanne Shaheen (D-NH), Jeff Merkley (D-OR), Kirsten Gillibrand (D-NY), Al Franken (D-MN), Chris Coons (D-DE), Richard Blumenthal (D-CT), Brian Schatz (D-HI), Tammy Baldwin (D-WI), Chris Murphy (D-CT), Mazie Hirono (D-HI), Martin Heinrich (D-NM), Angus King (I-ME),  Elizabeth Warren (D-MA), Ed Markey (D-MA),  Cory Booker (D-NJ), Gary Peters (D-MI), Chris Van Hollen (D-MD), Tammy Duckworth (D-IL), Maggie Hassan (D-NH), Kamala Harris (D-CA), and Catherine Cortez-Masto (D-NV).