Bill Introduced to Expand EITC, Child Tax Credit; White House Explores Child Credit Expansion

Sens. Tammy Baldwin, D-Wis., and Cory Booker, D-N.J., have introduced the Stronger Way Bill. This tax reform legislation addresses certain family-focused tax credits. The bill proposes enhancing both the Earned Income Tax Credit (EITC) and Child Tax Credit (CTC). Meanwhile, the White House reportedly has scheduled several meetings with lawmakers on the expansion of the CTC.

“Tax reform needs to reward hard work, raise incomes and help working families keep more of what they earn,” the senators said in a press release. “In stark contrast to the tax framework offered by President Trump …this bill will put money in the pocket of low- and middle-income individuals and families—not just the wealthy and the well-connected.”

The Trump administration and top GOP lawmakers’ tax reform framework proposes “significantly” increasing the CTC to an undisclosed amount. A new nonrefundable credit for nonchild dependents would also be created under the GOP framework.

Stronger Way Bill

The Stronger Way Bill would increase the rate at which the ETIC phases in for working families with children. It would also enhance EITC eligibility for childless workers by allowing certain individuals to receive the maximum amount of the credit.

Additionally, the bill would enhance the CTC by making the credit refundable for all families starting at the first dollar earned. “This tax reform simplifies the tax code, makes the credit more consistent with the EITC and targets additional CTC benefits to very low-income families, who are most in need,” the press release noted.

Earlier in 2017, Sens. Angus King, I-Me., and Richard Burr, R-N.C., introduced legislation that would expand the Child and Dependent Care Tax Credit. The bill would increase the credit rate for families of all income levels. The Promoting Affordable Childcare for Everyone (PACE) Bill (Sen 208) has not yet been considered in committee.

Child Tax Credit Expansion

In addition to outlining a Child Tax Credit expansion in its tax reform framework, the White House is reportedly also engaged in frequent discussions with bipartisan lawmakers on including a CTC expansion in GOP tax reform efforts. Ivanka Trump, assistant to President Trump, is reportedly scheduled to host two meetings in October with lawmakers on the issue. She has been coordinating her efforts on the CTC expansion with the White House Office of Legislative Affairs and Treasury Department, according to several reports. “A significant expansion of the CTC will help parents have more money at a time in their lives when they need it the most and give them the flexibility to make the best choices regarding their families’ care,” she said in a statement.

By Jessica Jeane, Wolters Kluwer News Staff

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