Working Family Tax Credits Are Good for Wa. State’s Children and Economy
By Elena Hernandez, Narver Fellow -- The federal Earned Income Tax Credit (EITC) encourages work and promotes a path to the middle class. A new report by the Center on Budget and Policy Priorities (CBPP) provides detailed information about the impact of the EITC, and the related Child Tax Credit (CTC), on low and moderate income families in Washington state.
The EITC is an important tool for promoting work, improving the educational outcomes of low-income children, increasing work effort and earnings in adulthood. Washington state could amplify these benefits by fully funding the Working Families Tax Rebate (WFTR), a state version of the EITC that was enacted in 2008, but never funded.
According to the report, 449,000 Washington state households benefited from the EITC and 368,000 from the CTC in 2010. Combined, the credits helped lift 208,000 Washingtonians out of poverty, including 108,000 of children. Not only do these credits help keep parents in jobs, they also help their children – our future workforce – succeed in the long run. Making sure that our children get the education and skills they need for successful careers is vitally important to ensure Washington state’s future prosperity.
Read the full CBPP report here. For more information on the Working Families Tax Rebate, check out our primer.