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1 1 (December 13, 2021)

handle is hein.crs/goveezd0001 and id is 1 raw text is: Congressional SResearch Service The Earned Income Tax Credit (EITC) in the Senate Finance Committee Text of the Build Back Better Act: Summary Table December 13, 2021 On December 11, 2021, the Senate Finance Committee released updated text of the committee's provisions in the Build Back Better Act (BBBA; H.R. 5376). This updated text of the BBBA would extend the 2021 expansion of the earned income tax credit (EITC) for taxpayers without qualifying children for one year-2022. The EITC for taxpayers with qualifying children generally would not be modified by BBBA. With respect to the EITC provisions, the updated Finance Committee text is identical to the House-passed BBBA. The EITC for taxpayers without qualifying children is sometimes referred to as the childless EITC. The term childless, however, may be misleading. While childless EITC recipients include those who do not have any children, they may also include workers who do have children, but not children that the taxpayer can claim for the EITC (e.g., they may have noncustodial children, live with children for less than six months of a year, or live with nonbiological children they cannot claim for the credit). The EITC was only available to low-income workers with qualifying children when it was enacted in the mid-1970s. The credit was expanded to include taxpayers without qualifying children in 1993 as part of the Omnibus Budget Reconciliation Act of 1993 (OBRA93, P.L. 103-66) to partly offset a gasoline tax increase included in the law. Prior to 2021, the childless EITC parameters had not been statutorily modified since OBRA93 (they are annually adjusted for inflation). In March 2021, the American Rescue Plan Act (ARPA, P.L. 117-2) temporarily expanded the childless EITC for one year-2021-by increasing the credit amount (with adjustments to the credit formula) and expanding eligibility to both younger and older workers without qualifying children. The childless EITC changes included in the updated Senate Finance Committee text (and House-passed BBBA) differ from those included in the legislation when it was initially reported by the House Budget Committee on September 27, 2021. Specifically, under the House Budget Committee bill, the ARPA expansion of the childless EITC would have been made permanent. Under the updated Senate Finance Committee text (and House-passed version of the BBBA), the ARPA expansion was temporarily extended Congressional Research Service https://crsreports.congress.gov IN11825 CRS INSIGHT Prepared for Members and Committees of Congress

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