Several new tax credits for businesses have passed the Legislature this session and will be funded in the biennial budget which is currently being debated in the Capitol. These business credits are incentives to businesses that work for Wisconsin to create and keep jobs here. Workers in Wisconsin don't get the kinds of tax credits that businesses do, but there are some tax credits for working families that are essential for our economy. The Earned Income Tax Credit (EITC) is one of those. Governor Walker's state budget cuts the EITC program and increases taxes on Wisconsin's qualifying working families on average by $300 a family; this is a mistake.
Both a federal and state tax credit, this refundable credit is only available for families that earn an income through employment and only available for working class individuals. There are income limits so if a family earns too much they won't qualify for the credit. The credit is refundable, which means that the full amount of the tax credit comes back to the tax payer. The EITC gives more credit back to families with more children.
At a time when more families have an unemployed member of their household who may soon become forced to take a low wage job instead of the job they are qualified for the EITC is essential. Unemployment Insurance is running out or about to run out for thousands of Wisconsin workers.
With the loss of the supplemental income (UI) meant to support families until another family supporting job is found; many will be forced to take a job below their skill and pay level. ETIC is more important than ever for these families.
This is not a luxury program. Families that earn an income and pay taxes can qualify for the credit. With one child the credit will increase from $124 to $155 in tax year 2011.
However for families with two children, the credit will drop from $716 to $409, and the maximum credit for families with three or more children will fall from $2,473 to $2,300. Now is the time to invest in our assets as a state and spend tax dollars wisely. Supporting hard-working families is one of those wise investments. A strong tax incentive to have a job and collect a pay check, the EITC should not only be maintained in this state budget it should be expanded.
Increasing taxes on working families is not the right decision. I am hopeful the Joint Committee on Finance sees the value of this modest tax credit and changes the current budget.
-Sen. Jon Erpenbach,
D-Middleton, represents the 27th Senate District.
Both a federal and state tax credit, this refundable credit is only available for families that earn an income through employment and only available for working class individuals. There are income limits so if a family earns too much they won't qualify for the credit. The credit is refundable, which means that the full amount of the tax credit comes back to the tax payer. The EITC gives more credit back to families with more children.
At a time when more families have an unemployed member of their household who may soon become forced to take a low wage job instead of the job they are qualified for the EITC is essential. Unemployment Insurance is running out or about to run out for thousands of Wisconsin workers.
With the loss of the supplemental income (UI) meant to support families until another family supporting job is found; many will be forced to take a job below their skill and pay level. ETIC is more important than ever for these families.
This is not a luxury program. Families that earn an income and pay taxes can qualify for the credit. With one child the credit will increase from $124 to $155 in tax year 2011.
However for families with two children, the credit will drop from $716 to $409, and the maximum credit for families with three or more children will fall from $2,473 to $2,300. Now is the time to invest in our assets as a state and spend tax dollars wisely. Supporting hard-working families is one of those wise investments. A strong tax incentive to have a job and collect a pay check, the EITC should not only be maintained in this state budget it should be expanded.
Increasing taxes on working families is not the right decision. I am hopeful the Joint Committee on Finance sees the value of this modest tax credit and changes the current budget.
-Sen. Jon Erpenbach,
D-Middleton, represents the 27th Senate District.
