April 15, 2019

New Federal Tax Credit Proposal Would Give Working Florida Families, Kids a Much-Needed Boost

This post was last updated on December 8, 2021. As new policies are announced, FPI will update this page.

As Florida’s response to COVID-19 takes front and center, concern grows for low-income families who struggle to take precautions against the spread of the virus. Although Congress has passed the Families First Coronavirus Response Act to address, at least in part,  the public health crisis and economic fallout from COVID-19, many barriers continue to keep struggling families from accessing the assistance they need during the pandemic. As Florida initiates policies implementing the Act and addressing other barriers to the safety net, FPI will update this form. When available, hyperlinks are provided to agency documents or statements that provide greater detail  about the new policy.

On March 22, 2020, FPI and 44 other organizations sent a letter to Governor DeSantis, leadership in the Legislature and agency heads to urge action on 47 specific policy changes to reduce unnecessary barriers for Florida’s safety net programs in response to the COVID-19 pandemic. See the letter here.

It’s important that people and corporations who benefit the most from the economy contribute their fair share to taxes. But lawmakers had other plans when they passed federal tax legislation in 2017, which included provisions to cut the corporate tax rate from 35 to 21 percent and reduce the top individual income tax rate, provisions that help the rich get richer at the expense of programs and services that benefit struggling families.

But there is some good news on the federal horizon. Legislation was introduced last week that would help working people with low-wage jobs and low-income people with children make ends meet and support themselves and their families.

The Working Families Tax Relief Act (WFTRA) would help more than 3 million families and 7.3 million individuals in Florida become more financially secure, and it would benefit more than 2.9 million children in the Sunshine State, according to an analysis by the D.C.-based, nonpartisan Center on Budget and Policy Priorities (CBPP).

Specifically, the WFTRA would:

  • Strengthen the highly successful Earned Income Tax Credit (EITC) for working families with children, expanding it by about 25 percent;
  • Ensure that millions of poor children aren’t left out of the Child Tax Credit (CTC) by making it fully refundable;
  • Boost the CTC for families with children under 6; and
  • Expand the EITC for working people without children, who receive only a nominal benefit under current law. (The CBPP report provides as an example a fast-food cook who works full-time and earns $14,500 — just above the poverty level for a single individual — and pays more than $1,250 in combined federal income and employee-side payroll taxes. The WFTRA would increase her EITC to $1,587 from $57.)

For working Florida families, this would mean more money for basic necessities, home repairs, maintaining a car to get to work, or in some cases, additional education or training to get a better, higher-paying job. The federal EITC is a significant policy success story– it lifted about 5.8 million people out of poverty in 2016, including 3 million children. Research shows it successfully encourages workforce participation. This Tax Day, let’s support tax policies like the WFTRA that build economic mobility ladders for low-income working Americans.

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