Research Description:

Making Work Pay: The Earned Income Tax Credit

Nationwide, more poverty exists in the United States than in any other industrialized country.  Work, the traditional path out of poverty, does not pay for many Americans. The federal minimum wage of $5.15 has not changed in ten years, but the Consumer Price Index has increased by 20%. As a result, a full-time minimum-wage worker earns approximately $10,700 a year—$5,900 less than the 2006 poverty line for a family of three. Despite recent proposals to raise the minimum wage, salary alone will not lift these families out of poverty. Families need income supports—such as the Earned Income Tax Credit—to make ends meet.

The Earned Income Tax Credit (EITC), the nation’s largest anti-poverty program, directly lifted 4.9 million people out of poverty in 2002, including 2.7 million children. A means-tested transfer program, the EITC is a refundable tax credit that reduces the tax burden for low-income families and supplements income at no additional cost to employers.  Despite widespread bipartisan support, the EITC remains one of the nation’s most underutilized social programs.

I propose to research outreach efforts both locally, in East Gainesville, and nationally, through work with the National Community Tax Coalition.  By means of a survey, I hope to assess the effectiveness of existing EITC outreach campaigns in Gainesville, and go on to meet with Congressional members in Washington, D.C. to assess nationwide campaigns.  Joining quantitative data, from the Census Bureau and IRS, with the qualitative data of surveys and meetings with city, state, and federal officials, I hope to create a comprehensive view of the state of the EITC and propose solutions to its continued underutilization.