The EITC: Expectation, Knowledge, Use, and Economic and Social Mobility

This paper presents our findings on the knowledge and use of the 1997 Earned Income Tax Credit (EITC) based on a sample of Chicago area households, with children, that filed tax returns in the winter and spring of 1998. Respondents reported in detail about using their federal tax refunds (including...

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Bibliographic Details
Published in:National tax journal 2000-12, Vol.53 (4), p.1187-1209
Main Authors: Smeeding, Timothy M., Phillips, Katherin Ross, O'Connor, Michael
Format: Article
Language:English
Subjects:
Analysis
Children
Credit cards
Earned income
Earned income tax credit
Economic benefits
Economic expectations
Effects
Families & family life
Federal taxes
Income taxes
Social mobility
Studies
Tax credits
Tax payments
Tax refunds
Tax returns
Upward mobility
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Summary:This paper presents our findings on the knowledge and use of the 1997 Earned Income Tax Credit (EITC) based on a sample of Chicago area households, with children, that filed tax returns in the winter and spring of 1998. Respondents reported in detail about using their federal tax refunds (including the EITC) to pay bills, purchase new items, or save. Data were also gathered on respondents' prior knowledge of the EITC and their ability to make particular expenditures without the help of the EITC. Uses of the EITC are divided into those that improve economic and social mobility (e. g., purchase a car, pay tuition, change residence) and those that primarily help to make ends meet (e. g., pay routine bills, purchase food). This is among the first papers to address these issues, despite the fact that the EITC is our largest refundable tax credit program targeted at low-income families.
ISSN:0028-0283
1944-7477
DOI:10.17310/ntj.2000.4S1.07