On Fathers Day, Take Note: 147,000 Utah Dads Helped by Working Family Tax Credits

19 June 2015 Written by  

dad and infant son smallOn Mother’s Day last month, Voices for Utah Children noted on our website and in the Salt Lake Tribune how many Utah moms are better able to raise their children and meet their obligations thanks to the Earned Income Tax Credit (EITC) and Child Tax Credit (CTC) when they file their federal taxes. This weekend is Fathers Day, so it’s our opportunity to give equal time to the dads!

 

All Utah dads deserve a break on their taxes, especially if it helps them meet their family responsibilities and get a leg up. Those two federal tax credits mentioned above allow 147,000 Utah dads to keep thousands of dollars more of what they earn every year.

 

Combined, the EITC and CTC lifted 9.4 million Americans out of poverty in 2013, and more than 100,000 here in Utah, more than any other federal program besides Social Security.

 

Best of all, the EITC and CTC have proven long-term benefits for parents and their kids.

 

Because these tax credits require work to qualify, they promote family self-sufficiency. The parents’ boost in work effort and earnings extends into the next generation, with more work and higher earnings years later for children raised by parents who benefit from the added take-home pay these tax credits provide. In addition, children whose families receive the tax credits have been shown to perform better and go farther in school.

 

It's no surprise that the credits have enjoyed strong, bipartisan support over the years.

 

However, unless Congress acts, millions of fathers and kids will lose some or all of the important benefits they receive from the EITC and CTC. Three key provisions are set to expire, and they happen to be ones that are especially important here in Utah:

1) The current larger EITC for families raising more than two children.

2) EITC "marriage-penalty" relief.

3) The current lower CTC earnings exclusion, which expands the credit for millions of working families and means fewer working-poor families are shut out of the credit entirely. As just one example, a single father with two kids working as a custodian earning the minimum wage would lose about $1,725 — his entire CTC — unless Congress acts.

 

Fortunately, Congress can act to stop 13 million families with 25 million children (including 115,000 Utah families with 258,000 children) from losing all or part of their credits, which would cost these families an average of $840 a year. But if Congress fails to act, 143,000 Utahns, including 74,000 children, will be pushed into — or deeper into — poverty.

Matthew Weinstein 300Matthew Weinstein, State Priorities Partnership Director, joined the organization in 2014. As State Fiscal Policy Director, he conducts analysis and advocacy focused on the state budget from the perspective of what's best for Utah's children. He holds a Master of Public Policy degree from Georgetown University and a B.A. in Political Science from Amherst College.