Category: Federal Policy
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October 4, 2021
State Income Tax Reform Can Bring Us Closer to Racial Equity
To pave the way for a more racially equitable future, states must move away from poorly designed, regressive policies that solidify the vast inequalities that exist today. -
Steve Wamhoff
Federal Policy DirectorWhen people first hear about proposals to tax unrealized capital gains, they often ask, “Is this income, and if so, should we tax it?” The answers to those questions are “yes” and “yes, when we are talking about the very rich.” -
Carl Davis
Research DirectorSeptember 28, 2021
Reforming Federal Capital Gains Taxes Would Benefit States, Too
Congress’s action or inaction on federal tax changes under consideration in the Build Back Better plan could have important implications for states on many fronts. One critical area of note is at the foundation of income tax law: setting the definition of income that most states will use in administering their own income taxes. -
Steve Wamhoff
Federal Policy DirectorThe vast majority of these tax increases would be paid by the richest 1 percent of Americans and foreign investors. The bill’s most significant tax cuts -- expansions of the Child Tax Credit (CTC) and Earned Income Tax Credit (EITC) -- would more than offset the tax increases for the average taxpayer in all income groups except for the richest 5 percent. -
Steve Wamhoff
Federal Policy DirectorHigh-income people and corporations would pay more than they do today, which is a monumental change. But some wealthy billionaires like Jeff Bezos would continue to pay an effective rate of zero percent on most of their income, and American corporations would still have some incentives to shift profits offshore. -
Neva Butkus
Senior Policy AnalystSeptember 14, 2021
New Census Data Highlight Need for Permanent Child Tax Credit Expansion
The status quo was a choice, but the Census data released today shows that different policy choices can create drastically different outcomes for children and families. It is time for our state and federal legislators to put people first when it comes to recovery. -
Aidan Davis
State Policy DirectorThe move toward permanent full refundability and inclusion of all immigrant children are crucial components of the future of the CTC. Together they will help ensure that the credit reaches the children most in need, making a vital dent in our nation’s unacceptably high rate of child poverty. -
Aidan Davis
State Policy DirectorThe EITC expansion targets workers without children in the home. In 2022 it would provide a $12.4 billion boost, benefiting 19.5 million workers who on average would receive an income boost of $730 dollars. -
Aidan Davis
State Policy DirectorFor the next six months, low-, middle- and upper-middle-income families with children are eligible to receive part of their 2021 Child Tax Credit (CTC) in advanced monthly payments. More than putting money in people’s pockets, this policy recognizes “the dignity of working-class families and middle-class families,” as President Biden said last week. -
Steve Wamhoff
Federal Policy DirectorSpecial interests lobbying against President Joe Biden’s tax agenda claim that his proposed corporate income tax rate hike will harm small businesses and that his proposed capital gains tax reforms will hurt family farms. Both claims are absurd attempts by powerful interests to pretend they are defending the little guy. -
Steve Wamhoff
Federal Policy DirectorIRS budget cuts starting in 2010 have forced the agency to reduce its audit rate for corporations with $20 billion or more in assets from 98 percent to 50 percent. The Washington Post found that during the decade, the amount of “uncertain tax benefits” claimed by corporations increased 43 percent, from $164 billion in 2010 to $235 billion in 2020. -
Jenice R. Robinson
Communications DirectorDuring a Tuesday webinar (The Child Tax Credit in Practice: What We Know about the Payoffs of Payments) hosted by ITEP and the Economic Security Project, panelists explained why the expanded Child Tax Credit is a transformative policy that should be extended beyond 2021. They highlighted tax policy and anti-poverty research and discussed lessons learned from demonstration projects that have provided a guaranteed income to low-income families. -
Meg Wiehe
Deputy Executive DirectorPresident Joe Biden's American Families and Jobs plans intend to “build back better” and create a more inclusive economy. To fully live up to this ideal, the final plan must include undocumented people and their families. -
Steve Wamhoff
Federal Policy DirectorMembers of Congress frequently claim they want to make it easier for working people to scrape together enough savings to have some financial security in retirement. But lawmakers’ preferred method to (ostensibly) achieve this goal is through tax breaks that have allowed the tech mogul Peter Thiel to avoid taxes on $5 billion. This is just one of the eye-popping revelations in the latest expose from ProPublica. -
Aidan Davis
State Policy DirectorNearly one in seven children in the United States live in poverty and about 6 percent of all children live in deep poverty. President Joe Biden’s American Families Plan would tackle child poverty in an immediate, meaningful way. It is expected to extend the one-year Child Tax Credit (CTC) enhancements included in the March 2021 American Rescue Plan (ARP) through 2025. Next year alone, this would provide around a $110 billion collective income boost to roughly 88 percent of children in the United States. -
Steve Wamhoff
Federal Policy DirectorThe agreement announced over the weekend from the finance leaders of the Group of 7 (G7) countries to allow governments to tax some corporate profits based on the location of sales and to implement a 15 percent global minimum tax is a major step forward—but in no way changes the need for Congress to enact President Joe Biden’s tax reforms right now. -
Steve Wamhoff
Federal Policy DirectorThe Treasury Department released a report explaining what the administration’s tax enforcement plan would do—and how it fits into the president’s overall plan to collect more revenue from profitable corporations and individuals making more than $400,000 a year. -
Each year, corporations publicly state that some of the tax breaks they claim are unlikely to withstand scrutiny from tax authorities. And each year, corporations report that they will keep some of the dubious tax breaks they declared in previous years simply because the statute of limitations ran out before tax authorities made any conclusions. This suggests that, perhaps because of cuts to its enforcement budget, the IRS is not even investigating corporations that publicly announce they have claimed tax breaks that tax authorities would likely find illegal. -
Aidan Davis
State Policy DirectorOverall, the EITC enhancement would provide a $12.4 billion boost in 2022 if made permanent, benefiting 19.5 million workers. It would have a particularly meaningful impact on the bottom 20 percent of eligible households who would receive more than three-fourths of the total benefit. Forty-one percent of households in the bottom 20 percent of earners would benefit, receiving an average income boost of 6.3 percent, or $740 dollars. -
Marco Guzman
Senior Policy AnalystAs the Biden administration maps out the next steps in America’s response to the coronavirus pandemic—through what is now being called the American Families Plan—it should make sure a proposed expansion of the Child Tax Credit (CTC) includes undocumented children who have largely been left out of federal relief packages this past year. Prior to 2017 Tax Cut and Jobs Act, all children regardless of their immigration status received the credit as long as their parents met the income eligibility requirements. This change essentially excluded around 1 million children and their families. -
Amy Hanauer
Executive DirectorApril 27, 2021
Alvin Schorr and the Policy Relay Race
Sometimes a good idea takes a while. Alvin Schorr, who would have turned 100 this month, helped draft a 1972 bill “to provide for a system of children’s allowances.” He continued to push (in a 1977 congressional testimony and in a 1983 New York Times op-ed) for a refundable tax credit for all families and a children’s allowance, among other laudable ideas. A half-century later, these ideas—which many others have championed—are becoming reality. -
A bipartisan group of 32 House lawmakers banded together to form the “SALT Caucus,” demanding elimination of the SALT cap. None of their arguments in favor of repeal change the fact that it would primarily benefit the rich and, according to new research, exacerbate racial income and wealth disparities. -
Matthew Gardner
Senior FellowIt was (allegedly) P.T. Barnum who first said “there’s no such thing as bad publicity.” But the public relations professionals at the Nike Corporation clearly disagree with this maxim. Last week, after multiple media outlets, including the New York Times, wrote about ITEP’s conclusion that Nike avoided federal corporate income taxes under the Trump tax law, the company contacted these news organizations to… change the subject. -
Steve Wamhoff
Federal Policy DirectorThe Biden administration has already provided details on its corporate tax proposals and in the next couple of weeks is expected to propose tax changes for individuals. Meanwhile, congressional Democrats have some ideas of their own. What should we expect? -
Steve Wamhoff
Federal Policy DirectorApril 1, 2021
Biden’s Corporate Tax Revolution
The corporate tax plan put forth on Wednesday by President Joe Biden to offset the cost of his infrastructure priorities would be the most significant corporate tax reform in a generation if enacted.
Blog Categories
- Corporate Taxes
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- Tax Reform Options and Challenges
- Taxing Wealth and Income from Wealth
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