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ADVOCACY FOCUS MAGAZINE | MARCH 2023
Earned Income Tax MICHIGAN EITC IN YOUR COUNTY:
Credit Expansion Ingham
Michigan League for Public Policy | January 2023
Passed by the State The Michigan Earned Income Tax Credit (EITC) is a tax credit for workers and families with low incomes to help
Legislature them meet basic spending needs. Michigan’s current EITC—at just 6% of the federal credit—provides help to
working families struggling to make ends meet by boosting after-tax incomes.
A families statewide received an average credit of $150, putting more than $110 million back into the Michigan
The EITC pulls Michigan families above the poverty line and reduces inequality. In tax year 2019, about 738,380
significant expansion to the
economy.
Michigan’s Earned Income Tax
COUNTY SNAPSHOT
Credit (EITC) was passed by the
State Legislature and is awaiting
If Expanded
Local Impact
Current
If Restored
final approval by the Governor. In 2019, about 20,850 families in Ingham County (15.90%) benefited from the Michigan EITC.
(6% of the federal EITC) (20% of the federal EITC) (30% of the federal EITC)
Average boost to a working $143 $477 $716
HB 4002 would expand Michigan’s EITC to family’s income
30 percent upon becoming law, helping Amount returned to local
Michigan’s working families with a historic economy $2.99M $9.95M $14.93M
tax cut. House Bill 4002 would apply
retroactively, providing the tax cut to EQUITY MATTERS HOW IT WORKS
filers for the 2022 tax year, immediately
MICHIGAN EITC IN YOUR COUNTY:
The EITC helps small
helping hardworking Michigan families The EITC helps workers of all races, but it’s especially businesses and boosts local
Eaton
dealing with the effects of high inflation. impactful for people of color, who are disproportionately economies by helping workers
represented in low-paying jobs due to past and present
In practical terms, that takes the average discrimination in the workplace and educational institutions. with low incomes pay for
Michigan League for Public Policy | January 2023
things that help keep them
current benefit from $150 to $750 for The impacts of EITC span geographies across Michigan— working, such as child care and
transportation.
Michigan’s working families. The Michigan Earned Income Tax Credit (EITC) is a tax credit for workers and families with low incomes to help
rural, urban, and suburban. Take-up is highest in rural
them meet basic spending needs. Michigan’s current EITC—at just 6% of the federal credit—provides help to
counties, where 16.5% of taxpayers claimed the credit
Children of EITC recipients
working families struggling to make ends meet by boosting after-tax incomes.
compared to 15.5% in urban counties. Credits are typically
are healthier, do better and
The Lansing Regional Chamber joined higher in urban counties, which saw an average state EITC of go further in school, and earn
$154 compared to $135 in rural counties.
more than 230 groups from around The EITC pulls Michigan families above the poverty line and reduces inequality. In tax year 2019, about 738,380
more as adults.
families statewide received an average credit of $150, putting more than $110 million back into the Michigan
Michigan to support a major increase economy.
CALL TO ACTION
COUNTY SNAPSHOT
in the state’s Earned Income Tax Credit Policymakers are focused on boosting the EITC in 2023, and your voice will make a difference! House Bill 4002,
(EITC), including influential state business, sponsored by Rep. Nate Shannon, calls for restoration of the state EITC to 20% of the federal credit, and Senate
In 2019, about 6,810 families in Eaton County (12.10%) benefited from the Michigan EITC.
religious, health and social services Bill 3, sponsored by Sen. Kristen McDonald Rivet, calls for increasing the EITC to up to 30% of the federal credit.
Current
Local Impact
If Restored
If Expanded
organizations. This aligns with the Now is the time for transformational change, and boosting the credit to 30% is supported by the League and
(20% of the federal EITC)
(6% of the federal EITC)
(30% of the federal EITC)
Average boost to a working
$448
$134
$672
Chamber’s policy priority focus on Taxation. more than 230 of the leading health, social services, business and religious organizations around the state.
family’s income
Michigan League for Public Policy, 1223 Turner Street, Suite G1, Lansing, MI 48906-4369
Background: The EITC is a refundable Amount returned to local $914,800 $3.05M $4.57M
Phone 517.487.5436 • Fax 517.371.4546 • www.mlpp.org • A United Way Agency
Federal Credit established in 1975 by economy
Michigan’s own President Gerald Ford,
with support from both Democrats and EQUITY MATTERS HOW IT WORKS
Republicans. It was later expanded by The EITC helps small
MICHIGAN EITC IN YOUR COUNTY:
The EITC helps workers of all races, but it’s especially
President Ronald Reagan. The Michigan impactful for people of color, who are disproportionately businesses and boosts local
Clinton
EITC was started in 2006 with bipartisan represented in low-paying jobs due to past and present economies by helping workers
with low incomes pay for
support. Today, eligible taxpayers get 6 discrimination in the workplace and educational institutions. things that help keep them
Michigan League for Public Policy | January 2023
working, such as child care and
percent of their federal EITC payment The Michigan Earned Income Tax Credit (EITC) is a tax credit for workers and families with low incomes to help
The impacts of EITC span geographies across Michigan—
transportation.
rural, urban, and suburban. Take-up is highest in rural
through the Michigan EITC. HB 4002 them meet basic spending needs. Michigan’s current EITC—at just 6% of the federal credit—provides help to
counties, where 16.5% of taxpayers claimed the credit
and SB 3 would raise that to 30 percent. working families struggling to make ends meet by boosting after-tax incomes. Children of EITC recipients
compared to 15.5% in urban counties. Credits are typically
are healthier, do better and
higher in urban counties, which saw an average state EITC of
Benefits only go to working taxpayers and The EITC pulls Michigan families above the poverty line and reduces inequality. In tax year 2019, about 738,380
go further in school, and earn
$154 compared to $135 in rural counties.
more as adults.
phase out at higher incomes, ending at families statewide received an average credit of $150, putting more than $110 million back into the Michigan
$57,414 for a couple with three dependents. economy. CALL TO ACTION
COUNTY SNAPSHOT
Policymakers are focused on boosting the EITC in 2023, and your voice will make a difference! House Bill 4002,
In 2019, about 2,670 families in Clinton County (9.60%) benefited from the Michigan EITC.
More than 730,000 Michigan households sponsored by Rep. Nate Shannon, calls for restoration of the state EITC to 20% of the federal credit, and Senate
Bill 3, sponsored by Sen. Kristen McDonald Rivet, calls for increasing the EITC to up to 30% of the federal credit.
received the state EITC in 2019 – impacting Local Impact Current If Restored If Expanded
(30% of the federal EITC)
(20% of the federal EITC)
(6% of the federal EITC)
nearly one million Michigan children – Now is the time for transformational change, and boosting the credit to 30% is supported by the League and
Average boost to a working
more than 230 of the leading health, social services, business and religious organizations around the state.
putting nearly $110 million back into family’s income $135 $451 $676
Michigan’s economy. Both HB 4002 and SB Michigan League for Public Policy, 1223 Turner Street, Suite G1, Lansing, MI 48906-4369
Phone 517.487.5436 • Fax 517.371.4546 • www.mlpp.org • A United Way Agency
3 would boost that by $460 million to an Amount returned to local $360,900 $1.20M $1.80M
economy
estimated $570 million. l
EQUITY MATTERS HOW IT WORKS
12 The EITC helps workers of all races, but it’s especially The EITC helps small
impactful for people of color, who are disproportionately businesses and boosts local
represented in low-paying jobs due to past and present economies by helping workers
