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Papers

Policy Proposal Oct 19, 2017

Tax Policies to Encourage Women’s Labor Force Participation

Ordinarily, the progressive income tax system acts to mitigate differences in before-tax earnings. However, the tax treatment of married couples tends to raise the tax rate faced by the spouse who is the lower earner in a couple. This group of spouses, often referred to as secondary earners, is still predominantly female. Consequently, the current tax treatment of married couples reduces wives’ labor force participation and creates other inefficiencies. LaLumia proposes a new second-earner deduction equal to 15 percent of the earnings of a lower-earning spouse. The proposed deduction would raise the after-tax return to work for many wives, encouraging an increase in married women’s labor supply, and would reduce marriage penalties on average.

Policy Proposal Jun 16, 2014

Building on the Success of the Earned Income Tax Credit

In this policy memo, Hilary Hoynes proposes expanding the Earned Income Tax Credit (EITC) by raising the benefits for families with one child to be on par with the benefits for families with two children. This proposal aims to strengthen work incentives for low-income, one-child families; raise 410,000 people—including 131,000 children—out of poverty; and increase after-tax income by about $1,000 for one-child EITC beneficiaries, leading to improvements in health and children’s cognitive skills. This proposal is chapter eleven of The Hamilton Project’s Policies to Address Poverty in America, and a segment in Improving Safety Net and Work Support.

Policy Proposal Jun 2, 2014

Supporting Low-Income Workers through Refundable Child-Care Credits

In this policy memo, James P. Ziliak proposes converting the federal Child and Dependent Care Credit from a nonrefundable tax credit to a refundable one, capping eligibility at $70,000 and making the credit a progressive function of income, child age, and use of licensed care facilities. This proposal, targeted at low- and middle-income families with children under the age of twelve, aims to increase labor force participation, disposable income, and the use of higher-quality child care. This proposal is chapter ten of The Hamilton Project’s Policies to Address Poverty in America, and a segment in Improving Safety Net and Work Support.