Expanding the EITC for Workers without Resident Children

The federal earned income tax credit (EITC) is a refundable tax credit that provides substantial cash benefits to low-income working families with children. Working adults without children at home--including noncustodial parents, who are considered "childless" for tax purposes--also face economic challenges but receive few EITC benefits. 

What if the EITC for low-wage workers were expanded so that more families without resident children could benefit? These fact sheets and accompanying brief explore what would happen if the EITC for childless adults was significantly expanded. Through both national and state-level estimates, we show the number of workers who would become newly eligible for the EITC and the increase in EITC benefits for both currently and newly eligible workers.  Using Urban’s Analysis of Transfers, Taxes, and Income Security (ATTIS) microsimulation model with 2016 American Community Survey data, we modeled the following expansion of the childless EITC: 

  • tripling the maximum EITC benefit for childless workers from about $500 to about $1,500 per year ($1,500 is about half the maximum amount a family with one child can receive); 
  • expanding eligibility to childless workers with incomes up to $28,000 per year ($34,000, if married), well above the current phase-out income of $15,000 per year ($21,000, if married); and
  • reducing the minimum eligible age from 25 to 21.

We produced fact sheets for all 50 states plus the District of Columbia to illustrate the effects of an EITC expansion for workers without resident children.

 

Childless workers in all states would benefit under the policy expansion we modeled. In addition to increasing the federal EITC, this expansion would also result in an increase in state EITC benefits for workers in 22 states that calculate the state EITC as a percentage of the federal EITC. In each state fact sheet, we show: 

  • the number of workers who would be newly eligible for the childless EITC
  • the increase in average EITC benefits for workers already receiving the childless EITC and for all workers who would benefit from the policy expansion
  • the number of noncustodial parents who would qualify for the expanded childless EITC and the average amount by which their EITC benefit would increase, and
  • the total amount of EITC available to workers in each state after the expansion.

To learn more about our national estimates and methodology, please see the accompanying brief, “Expanding the Earned Income Tax Credit for Workers without Resident Children.”