Changes to Tax Credit Considered

Liz Gullett

Dec 10, 2021

A bill incrementally expanding the Earned Income Tax Credit (EITC) was considered in the Senate Finance Committee this week. The EITC provides a tax break for low to moderate income tax earners. The amount needed to qualify follows federal guidelines and varies depending on if a taxpayer has children, dependents, or is disabled.

Currently, for tax years beginning after December 31, 2011, the credit is 6%. The bill as introduced would have increased the credit to 10% by 2024. However, a proposed substitute would increase it even further. The proposed substitute to the bill would increase the credit in the following manner:

- 2022 tax year – 15%
- 2023 tax year – 20%
- 2024 tax year – 25%
- 2025 tax year and thereafter – 30%

For more information on the EITC, please click here.

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