Supporters push for increased Michigan income tax credit


Child advocacy organizations across the state are urging lawmakers to increase Michigan’s income tax credit to help tackle child poverty.

The Michigan League for Public Policy, Michigan’s Children, Council of Michigan Foundations, Think Babies Michigan and others are advocating support for Senate Bill 417 and pushing for further expansion of the EITC.

The EITC is a way for low-to-middle income individuals and families to get a reduction in their taxes. For those who qualify, the EITC can reduce taxes owed and potentially increase refunds.

Senate Bill 417 was introduced by Sen. Wayne Schmidt, R-Traverse City, in May 2021. If passed, it would gradually increase Michigan’s EITC to 30% of the federal rate.

Currently, Michigan offers 6% of the federal EITC. This rate has been in place since 2012 and was previously 20%.

Of 31 states that offer an EITC — including three states with a policy taking effect in 2023 — only four offer a lower percentage of the federal EITC than Michigan’s 6%.

The bill was discussed by Michigan’s Senate Finance Committee in December 2021 and May 2022. Governor Gretchen Whitmer called for increasing the state’s EITC in her State of the State Address. 2022 and its 2023 budget proposal.

About 19% of Michigan children live in poverty.  Several statewide advocacy groups say increasing the state's earned income tax credit would help reduce that number.

By increasing the state’s EITC, advocacy groups say struggling families will have more money to meet their needs and lift families out of poverty.

“Raising the EITC to 30% will put more money in the pockets of families struggling to afford basic necessities, including help with high childcare costs that keep too many parents out of the market. labor,” said Matt Gillard, President and CEO. children from Michigan.

The state average for the overall poverty rate is 14%. This number increases to 16% for families with children, 19% for children under 18 and 37% for single mothers.

Statewide, 13.7% of tax filers qualified for the EITC in 2020.

Emmet County had the lowest poverty rate in the region at 9%, which was also the rate for families. Ten percent of children live in poverty, as do 27 percent of single-parent families. In 2020, 10.9% of families in Emmet County received the EITC.

The overall poverty rate in Charlevoix County is 10%. It increases to 13% for families, 15% for children and 36% for single mothers. In 2020, 11.7% of families benefited from the EITC.

Cheboygan County’s overall poverty rate was 13%. This figure rose to 16% for families, 22% for children and 43% for single-parent households. In 2020, 15.8% of county families received EITC benefits.

Staff member Kaitlynn Alward (left to right) counts with Emma Nowka, Abby Nowka and Ensley O'Neal at the Training Wheels Childcare Center in eastern Jordan.  Increasing the state's EITC could help families more easily afford things like child care, according to several advocacy groups.

The overall poverty rate in Otsego County was 13%. The rate for families is 16%, while 18% of children live in poverty. Single mothers had a poverty rate of 29%. The EITC benefited 14.4% of county families in 2020.

Chippewa County’s poverty rate is above the state average at 17%. This rises to 23% for families and 28% for children under 18. More than half of families with single mothers – 52% – live in poverty. In 2020, 15.3% of families qualified for the EITC.

For single parents in Michigan, the EITC income threshold in 2021 was $42,158 with one eligible child, $47,915 with two eligible children, or $51,464 for three eligible children. These numbers increase to $48,108, $53,865 and $57,414 for married couples filing jointly.

“This state and local data illustrates the ongoing challenges Michigan children and their parents face — and increasing the state’s EITC remains one of the best ways for policymakers to help improve that in their district and throughout Michigan,” said Monique Stanton, president and CEO of the Michigan League for Public Policy.

— Contact journalist Mitchell Boatman at Follow him on Twitter @SentinelMitch.

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