Media Contact: Kali Schumitz, 410-412-9105 ext. 701
Today, on EITC Awareness Day, the Tax Credits for Maryland Families coalition is calling on the Maryland General Assembly to renew and expand the state’s highly effective working family tax credits. The legislature expanded the state’s Earned Income Tax Credit (EITC) and created a modest Child Tax Credit in 2021, but these actions will expire this year if the legislature does not renew them.
“These working family tax credits are among the most effective tools we have for reducing poverty, particularly for families with children,” said Robin McKinney, CEO of the CASH Campaign of Maryland, speaking at an EITC Awareness Day event that featured the interim IRS Commissioner, Comptroller Brooke Lierman, and county and city leaders. “Families still need and will benefit from this support as much as they did two years ago and allowing the credits to expire would be a step backwards.”
The 2021 expansions made more than 100,000 people newly eligible for the state EITC. The expansions also significantly increased the value of the credit for all recipients:
- The average state refundable credit for tax year 2020 increased to more than $850, with more than 400,000 Marylanders benefitting from this larger credit
- Upward of 90,000 workers not claiming dependents can now get a max credit of $530, several times greater than the credit they were previously eligible for
- More than 100,000 immigrant taxpayers became newly eligible for the credit
“These state tax credits have been a lifeline for immigrant families who were left out of so many other pandemic relief programs, even though they faced the same economic challenges of every other Marylander,” said Cathryn Paul, Public Policy Director for CASA. “However, they never should have been excluded in the first place from the credits that are available to any other taxpayer. We must continue to ensure all taxpayers are treated the same, regardless of immigration status.”
Legislators also took a first step in establishing a state Child Tax Credit that begins to address the flaws of the current federal Child Tax Credit. Nearly 250,000 children in Maryland are prevented from receiving the full $2,000-per-child credit because their families’ incomes are too low – or they may receive no credit at all because the adults were out of work that year.
Maryland’s current state credit, which is also set to expire if not renewed this legislative session, helps close this gap for a small number of families, providing a $500 credit for parents with $6,000 or less in income whose child has a disability.
Tax Credits for Maryland Families is urging the legislature to not only renew the credit but to build on it to reach more families.
“With rising costs hitting food, fuel, and rent, parents and kids in Maryland are struggling now more than ever,” said Benjamin Orr, President and CEO of the Maryland Center on Economic Policy. “It is time for state legislators to step up where the federal government has failed and fight for families in need.”
While there are many options for creating a Child Tax Credit, there are a few principles that the coalition believes are critical to make it as effective as possible:
- The state credit should be fully refundable and provide the greatest benefit to the families that are left out of the full federal tax credit
- All children should be eligible for the credit, regardless of their or their parents’ immigration status
- If the credit is large enough, families should have the option to receive payments in installments, rather than a lump sum at tax time
About Tax Credits for Maryland Families
Tax Credits for Maryland Families is a coalition of community-led organizations, nonprofits, and Marylanders working to strengthen the tax credits that give hundreds of thousands of working families in Maryland the opportunity to thrive. Working family tax credits like the Earned Income Tax Credit (EITC) and Child Tax Credit (CTC) help Marylanders afford basics like transportation and child care, so they can take care of their families and contribute to their communities and our economy. taxcreditsformdfamilies.org