Fifteen minutes can save you 15 percent or more on car insurance, according to GEICO. But did you know that President Obama's new tax proposal will help 13.5 million additional Americans who hold jobs but are still poor?
Obama's tax proposal for the poor
President Obama's proposal is basically an expansion of the earned income tax credit, which has been around for many years to help low-income families with children. Obama's new tax proposal will provide similar tax benefits to low-income workers who have no children. The primary benefits offered by the new tax proposal include:
- Doubling a childless worker’s maximum tax credit to about $1,000 a year
- Increasing the qualifying annual income level to $18,000
- Expanding the minimum age limit for such a tax benefit to 21 instead of age 24
- Expanding the maximum age limit to 67 instead of 65
How many will be helped by the tax credit expansion?
According to the White House, the expansion would help nearly half a million Americans rise above the federal poverty line and reduce the level of poverty for about 10 million people.
Reaction to Obama's proposal
For the most part, both Democrats and Republicans as well as economists agree with the idea of expanding the earned income tax credit so poor income earners with no children can benefit. One Harvard economist explained the benefit clearly by stating that such a tax expansion is "helping get kids up out of poverty. Not only is that a good thing for those kids, but it’s also incredibly good for the government budget if you take the long view.”
For more details about the plan, visit:
www.whitehouse.gov/sites/default/files/docs/eitc_report.pdf
To download the President's proposal, visit:
www.whitehouse.gov/sites/default/files/docs/eitc_report.pdf
