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Come up with topic and I will discuss it with the professor then u can start writing - Essay Example

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Earned income tax credit (EITCI), which was from its enactment in 1975 initially intended to offer a modest wage subsidy that offsets payment of taxes by low-income workers in the United States, is now widely distinguished as a refundable tax intended to help low-income workers…
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Come up with topic and I will discuss it with the professor then u can start writing
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Download file to see previous pages of 1980s, the welfare reform movement deeply transformed the prospects of the credit so that it no longer represented a modest work incentive, but rather acted as an anti-poverty device capable of raising the living standards of non-working Americans over and above the poverty line. In 1986, the EITC earned considerable credit in the political salience resulting to its radical expansion. A decade later when the Personal Responsibility and Work Reconciliation Act was established to replace the Aid to Families with Dependent Children (AFDC) to oversee welfare under the TANF program, the credit became the most consistent and the largest anti-poverty tool (Chetty 24).
In 1994, when the federal spending on the EITC became consistently higher than AFDC and TANF, it incrementally gained more attention among the US policy makers. By the 2009 fiscal year, EITC benefits to low-income workers accounted to about $60 billion in federal spending, nearly $35 billion more than that on TANF. To show the long-term effects of the shift, EITC disbursal in 1980 was nearly $5 billion, compared to approximately $18 billion AFDC outlays.
The American Recovery and Reinvestment Act of 2009 led to the expansion of the credit to include married couples and those families that had more three children. The expansion was ultimately extended through December 2012, and today, it is the largest tax benefit program for low-income working individuals, thus providing substantial tax dollars to the claimants.
The economic incidence -- also known as the tax burden -- of the EITC is borne by individuals who suffer economic loss resulting from the taxes. From its outset, the credit triggered increased tax payments made by individuals to the local treasuries and the state. This in turn influenced the relative prices of goods and services, which further resulted to changes in behavior of individuals. Ultimately, a section of the economic burden was (is) shifted from those bearing the legal incidence ...Download file to see next pagesRead More
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