Elizabeth Kneebone and Natalie Holmes, The Brookings Institution, December 2015. Each year, the EITC supplements low-income workers’ earnings, encouraging work and lifting millions of people out of poverty. It has positive lasting effects for parents, who have shown longer-run earnings increases and better health outcomes. At the same time, their children exhibit a host of benefits, from better school performance and higher rates of college enrollment to more hours worked and higher incomes in adulthood. Yet more can be done to preserve and build on the effectiveness of the EITC, and a growing number of elected officials and policy experts have proposed strengthening the credit. Three main recommendations have emerged from these proposals.
