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Washington Millionaires’ Tax, Expanded Working Families Tax Credit Make Tax Code Fairer
March 12, 2026 • By Marco Guzman, Dylan Grundman O'Neill
The Washington legislature has approved a new "millionaires' tax," a 9.9 percent tax on income over $1 million. The bill, which makes significant investments in public education and child care, will also expand the Working Families Tax Credit – the state’s EITC – to reach an additional 460,000 households.
Governor Should Put New Mexico’s Tax Interests First
March 6, 2026 • By Amy Hanauer, Amber Wallin
By decoupling from three misguided federal corporate income tax cuts under the One Big Beautiful Bill, plus taking steps to curb unfair corporate tax avoidance, SB 151 would raise and safeguard more than $120 million annually.
State Rundown 2/19: Necktie (NCTI) Offers a Way Out of a Knotty Situation
February 19, 2026 • By ITEP Staff
State lawmakers are grappling with a range of challenges as their fiscal outlooks deteriorate, federal tax enforcement wanes (after the Trump administration cut the IRS workforce by 25 percent), and a rewritten federal tax code sends states scrambling to decide what changes they might want to make in their own codes.
State Rundown 2/11: This Valentine’s Day, Conscious Decoupling Is Our Love Language
February 11, 2026 • By ITEP Staff
While some may be excited for a romantic Valentine’s Day this weekend, many state lawmakers are breaking up and decoupling from recent federal tax changes that are poised to leave states with revenue shortfalls – much like a bad date who forgets their wallet and asks you to pick up the tab.
What Did 2025 State Tax Changes Mean for Racial and Economic Equity?
February 9, 2026 • By Brakeyshia Samms
The results are a mixed bag, with some states enacting promising policies that will improve tax equity and others going in the opposite direction.
D.C.’s Fiscal Autonomy is at Stake, District’s Conformity Decisions Should Stand
February 6, 2026 • By Kamolika Das
Federal lawmakers passed a bill along party lines that would force the District of Columbia to override the decision of local elected officials and implement all of the costly and inequitable federal tax cuts passed under the “One Big Beautiful Bill Act” (OBBBA).
State Rundown 1/22: Cautious Tone Noticeable in Most Statehouses
January 22, 2026 • By ITEP Staff
Most states are adopting a very cautious approach so far this year as legislators begin their sessions and governors make their annual addresses, thanks to ongoing economic uncertainty and federal retrenchment.
Pennsylvania Just Gave Low-Income Workers a Tax Credit Boost. Now It’s Philadelphia’s Turn.
December 30, 2025 • By Kamolika Das
In the same way states are building upon federal tax credits, localities should consider building on state tax credits.
States Can Create or Expand Refundable Credits by Taxing Wealth, Addressing Federal Conformity
December 19, 2025 • By Zachary Sarver
Many states already recognize the potential of these credits to boost low- and moderate-income households. Other states should follow suit.
The Child Tax Credit (CTC) is an important tool to fight child poverty and help families make ends meet. When designed well, it can also make tax systems less regressive. As of 2020, only six states had CTCs. Today, 15 states have CTCs, with many credits exceeding $1,000 per qualifying child.
State Tax Action in 2025: Amid Uncertainty, Tax Cuts and New Revenue
July 28, 2025 • By Aidan Davis, Neva Butkus, Marco Guzman
Federal policy choices on tariffs, taxes, and spending cuts will be deeply felt by all states, which will have less money available to fund key priorities. This year some states raised revenue to ensure that their coffers were well-funded, some proceeded with warranted caution, and many others passed large regressive tax cuts that pile on to the massive tax cuts the wealthiest just received under the federal megabill.
A Well Targeted Federal Renter Credit Could Help Reduce Wealth Gaps
March 3, 2025 • By Brakeyshia Samms
While lawmakers often speak about income inequality, less attention is paid to wealth inequality. Wealth is distributed even more unequally than income in the U.S. in ways that reinforce racial divides, leave some households with too little to handle unexpected expenses, and enable some households to pass down enormous intergenerational wealth. A renter tax credit is one tool lawmakers can use to reduce wealth inequalities both within racial and ethnic groups and between these groups. As we show in our new analysis, Black and Hispanic households are more likely to be renters and hold less wealth than white households.
In the face of immense uncertainty around looming federal tax and budget decisions, many of which could threaten state budgets, state lawmakers have an opportunity to show up for their constituents by raising and protecting the revenue needed to fund shared priorities. Lawmakers have a choice: advance tax policies that improve equity and help communities thrive, or push tax policies that disproportionately benefit the wealthy, drain funding for critical public services, and make it harder for most families to get ahead.
How Would the Harris and Trump Tax Plans Affect Different Income Groups?
October 23, 2024 • By Jon Whiten
Presidential candidates Kamala Harris and Donald Trump have put forward a wide range of different tax proposals during this year’s campaign. We have now fully analyzed the distributional impacts of the major proposals of both Vice President Harris and former President Trump in separate analyses. In all, the tax proposals announced by Harris would, on average, lead to a tax cut for all income groups except the richest 1 percent of Americans, while the proposals announced by Trump would, on average, lead to a tax increase for all income groups except the richest 5 percent of Americans.
Deep Public Investment Changes Lives, Yet Too Many States Continue to Seek Tax Cuts
April 12, 2023 • By Aidan Davis
When state budgets are strong, lawmakers should put those revenues toward building a stronger and more inclusive society for the long haul. Yet, many state lawmakers have made clear that their top priority is repeatedly cutting taxes for the wealthy.
More Than One in Three Young Workers Would Benefit from EITC Reforms in Build Back Better Plan
February 8, 2022 • By Aidan Davis
Although the EITC expansion did not receive as much attention as the expanded Child Tax Credit, a new ITEP report shows the positive impact of allowing young workers without children in the home to maintain access to one of the nation’s most significant and effective anti-poverty programs.
A growing group of state lawmakers are recognizing the extent to which low- and middle-income Americans are struggling and the ways in which their state and local tax systems can do more to ensure the economic security of their residents over the long run. To that end, lawmakers across the country have made strides in enacting, increasing, or expanding tax credits that benefit low- and middle-income families. Here is a summary of those changes and a celebration of those successes.
Child Tax Credit Is a Critical Component of Biden Administration’s Recovery Package
June 11, 2021 • By Aidan Davis
Nearly 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.
Nearly 20 Million Will Benefit if Congress Makes the EITC Enhancement Permanent
May 13, 2021 • By Aidan Davis
Overall, 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.
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.
Young workers are confronting a harsh economic reality filled with student loan debt and far too few good-paying jobs. The pandemic reinforced this group’s long history of not receiving proper benefits, such as health insurance, from their employers. They also are often overlooked when it comes to policies that promote economic wellbeing. The federal Earned Income Tax Credit (EITC), for example, is a glowing success story. It lifted 5.8 million people out of poverty in 2018, including 3 million children. But a key shortcoming of the federal EITC: working adults without children in the home receive little to no benefit.
While the federal EITC provides a great deal of support for families with children, its impact is limited for those without children or who are not raising children in their homes. Childless workers under 25 and over 64 have for far too long received no benefit from the federal credit. And workers aged 25 to 64 have received very little value from the existing credit (the maximum credit is much smaller and the income limits more restrictive). The federal EITC’s meager benefits for just some childless adults lead to an inequitable outcome: the federal income tax system—which is ostensibly based…
Immediate Action State Lawmakers Can Take to Support Families and Children
February 2, 2021 • By Aidan Davis
If Congress does act and enact President Biden’s CTC expansion, states could simply couple to that federal change. The changes, while temporary, could become the foundation of a permanent state-level credit over the long-term. But state lawmakers need not wait for legislative action in DC. They can take immediate steps to ensure that their state’s most vulnerable children are positioned to succeed.
These EITC Reforms Would Help Struggling Families Now and Address Systemic Challenges
December 4, 2020 • By Aidan Davis
The tepid economic recovery is leaving millions behind. The nation still has nearly 10 million jobs less than it did in February, according to the latest jobs report. The number of people living in or near poverty is rising. Twelve million workers are about to lose their unemployment insurance, roughly four in 10 people report experiencing food insecurity for the first time, and conditions are likely to deteriorate further in the weeks ahead as we brace for another deadly surge in COVID cases and new or tightened restrictions on business and personal activity.
The Vital Role of Public Programs in Moving People and Families Out of Poverty
September 15, 2020 • By Aidan Davis
More families across our nation are struggling to meet their most basic needs. High unemployment, the struggle to put enough food on the table, and an inability to make rent or mortgage payments are widespread. Absent federal intervention, outcomes would have been worse. Over the past few months, federal and state relief measures have mitigated hardship. By putting cash in the hands of those who need it most, lawmakers were able to stabilize some families’ budgets and prop up our fragile economy. With time we will surely glean many lessons from 2020. But the sheer power of targeted assistance is already apparent.
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