In spite of a surge in COVID-19 cases nationwide, a fourth stimulus check looks unlikely, and the child tax credit is ending this month.
PopCulture reports the Connecticut state legislature, however, has passed a measure to expand the earned income tax credit, which benefits about 200,000 people. BGR reported that this represents a growing trend in which pandemic relief will be enacted at the state level in the future.
In an announcement last week, Connecticut Gov. Ned Lamond directed the state’s Congressional delegation to retroactively increase the state’s earned income tax credit for 2020. An article by The Hartford Courant reports that the state tax credit has been raised to 41.5 percent from 23 percent, meaning that taxpayers who qualify will receive more for their 2020 taxes this year. Tax refunds in the spring could range from $375 to $1,000 thanks to the credit.
Those receiving the boost in 2020 were eligible for it if their income was less than $56,844. Visit this state website to find out if you are eligible.
Connecticut Gov. Ned Lamont has hailed this credit as a lifeline for working families, saying: “It says we value the work you do. Work should pay.” According to him and his supporters in the public sector, most of this money will go to renters with children, citing the U.S. Census, so that they can pay their bills and live comfortably.
Lamont and Connecticut Republicans are calling for tax cuts as a result of the state’s budget surplus of over $900 million. A tax credit like this one is viewed as a holdover measure since deciding how to make those cuts is a contentious issue. Although, many pundits have noted that other states offer similar tax credits. Consequently, some say state lawmakers are now competing to make living conditions more favorable for state residents.
Similar tax credit programs are offered in neighboring New Jersey and other states are now following suit. From now through 2023, South Carolina has adopted an ambitious plan that will increase the state’s tax credit each year, and by the end, it will be at 125 percent. In this way, the state offers a larger earned income tax credit than the federal government.
This month marks the start of tax season in the United States, and the IRS website provides relevant information. Please visit your state government’s website for information about the programs in your state.