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Earned Income Tax Credit & Child Tax Credit

A hard-fought victory for working families

In 2015, Congress passed a $680 billion tax package that made a number of tax credits permanent—including improvements to the Earned Income Tax Credit (EITC) and the Child Tax Credit (CTC)—and extended others. This permanent extension of the EITC and CTC is important to help keep low-income working Latino families out of poverty.

See below for facts about the EITC and CTC:

They help working families

  • The EITC amounts to as much as $6,143 per family and the CTC can be up to $1,000 per child.
  • As many as 8 million Latino workers with 12 million children claimed the EITC in tax year 2013.
  • About 7 million Latino working families with children claimed refunds averaging over $1,400 through the low-income (or refundable) portion of the CTC.

They promote work

  • Only people who are working are eligible for the EITC and the CTC. When it was expanded in the 1990s, the EITC was a major factor in increasing single mothers’ employment.

They also help low-wage earners

  • The EITC and the CTC are refundable. This means very low-income families can still earn a partial credit.

They help reduce poverty

  • The CTC was expanded in 2009 to reach families earning as little as $3,000 per year, lifting 1.1 million people above the poverty line in 2013.

 

See how these credits are vital to your state's economy