Who would benefit from a Georgia Work Credit?
Any family eligible to receive the federal EITC would also benefit from a Georgia Work Credit, including:
- About 1.1 million Georgia households, the equivalent of 28 percent of all Georgians filing federal income tax returns.
- An estimated 2.6 million Georgians in total
- Nearly 1.2 million children
- Approximately 770,000 working moms and 410,000 working dads
- 80,000 veterans and military families
The credit delivers the largest value to families on the cusp of the middle class making from about $10,000 to $23,000 a year, though families making up to about $53,000 can qualify depending on specific circumstances like number of children.
Roughly half of all taxpayers with children nationwide make use of the EITC at some point in their lives, usually for only a year or two at a time. The credits are an especially critical work support for young parents, military veterans and low-wage workers trying to keep their families out of poverty. The EITC lifted 248,000 Georgians, including 131,000 children, out of poverty each year, from 2011 to 2013.
The benefits of the EITC also extend well beyond the adult workers who claim it on their tax returns. Children in affected families receive some of the credit’s most important benefits, since the added funds help create a healthier and more stable home environment for them to thrive. Research finds that children whose families receive more income from the EITC are likelier to excel in school, graduate high school, attend college and earn more as adults.
Local communities benefit too, since the credit puts money directly in the pockets of the people most likely to spend additional dollars in local businesses. Small businesses today consistently cite things like “poor sales” and “not enough customers” as among the key reasons why they struggle. But when working families have more disposable income to spend in local shops and restaurants, small businesses and local economies thrive. In 2013, the federal EITC delivered $2.93 billion to a broad swath of working Georgians at an average value of $2,700 per recipient. A Georgia Work Credit set at 10 percent of the federal credit would pump an additional $270 million into Georgia communities.