Much has been made of the fact that nearly half of Americans paid no federal income tax in 2010. Some people interpret that statistic as saying that we are a nation of makers and takers, with the makers paying the taxes that support the takers. But the story is not that simple. This video explains who doesn’t pay income taxes and why, and notes that the share of non-payers is headed down to just a third a decade from now.
A new CBPP analysis of Census and IRS data finds that about one in four, or 1.5 million military families, receive either the Earned Income Tax Credit or the low-income component of the Child Tax Credit.
Highlights from the past few weeks include Senate Finance Chairman Baucus releasing a proposal that includes penalties for paid tax preparers that fail to follow due diligence requirements for the Child Tax Credit, a proposal from Congressman Jose Serrano that would allow families to put part of their EITC refunds into savings accounts supplemented by federal funds, and two major opportunities out of New York to improve the state’s tax credits for working families.
Highlights from the past two weeks include the Census Bureau’s Supplemental Poverty Measure revealing that refundable tax credits like the EITC and Child Tax Credit proved the second most effective government benefit in keeping Americans out of poverty in 2012, and a proposed pilot program in Chicago to issue advanced quarterly EITC payments to nearly 500 working families who need money before tax season to make ends meet.