Abstract
Context The EITC is a refundable federal income tax credit targeted to low-to–moderate-income individuals and families and is regarded as one of the most effective tools to supplement low-to-moderate-income workers’ earnings (IRS, 2008). It is estimated that this benefit lifts over four million people out of poverty each year (The Annie E. Casey Foundation, 2007; Holt, 2006). The EITC is often a sizable sum of money. For the 2008 tax year, the maximum credit for a childless filer for EITC was $438; a filer with one qualifying child could receive a maximum credit of $2,917; for individuals with two or more qualifying children, it was $4,824 (IRS, 2008). For the 2008 tax year, 23.1 million eligible individuals and families claimed EITC and approximately $44.6 billion were returned to eligible tax filers (The Center on Budget and Policy Priorities, 2009).
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