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Earned income credit utilization by welfare recipients: A case study of Minnesota's earned income credit program
Author(s) -
Hirasuna Donald P.,
Stinson Thomas F.
Publication year - 2006
Publication title -
journal of policy analysis and management
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 2.898
H-Index - 84
eISSN - 1520-6688
pISSN - 0276-8739
DOI - 10.1002/pam.20230
Subject(s) - earned income tax credit , incentive , welfare , economics , labour economics , work (physics) , tax credit , safety net , demographic economics , business , public economics , microeconomics , mechanical engineering , engineering , market economy , political science , law
This paper examines utilization of a state earned income credit by AFDC and TANF recipients. Although utilization percentages are increasing, we find that among TANF recipients in 1999, 45.7 percent of all households and 34.8 percent of eligible households did not receive the state earned income credit. Moreover, we find that utilization may depend upon TANF requirements and incentives, information resources, and barriers to work and filing of income tax returns. Finally, we investigate whether low utilization is because of little or no benefit from the state earned income credit and find this may be true for some with barriers or less incentive to work under TANF. © 2006 by the Association for Public Policy Analysis and Management.