Income

Middlesex United Way calls for increased earned income tax credit for families

MIDDLETOWN — A public hearing was held Thursday with Senate Speaker Looney and House Speaker Ritter to address legislation regarding the increased earned income tax credit. Connecticut has an opportunity to take meaningful action now to support the nearly 123,000 limited-income, employed working families in our state with children.

Connecticut United Ways spoke in support of the proposed increase and outlined the benefits, highlighting four practical, proven actions that bridge stability for Connecticut families and essential workers.


The first goal is to maintain Connecticut’s EITC at 41.5% of the federal rate in future years. The EITC is a state refundable tax credit for low to moderate income workers, which is based on the federal earned income tax credit, and we must take action to maintain the 41.5 % of the federal rate in future years.

On average, Connecticut’s EITC provides $925 in flexible income to more than 200,000 working state households to fill gaps in essential areas of the family budget, including child care, rent, food, transportation and medical expenses. The impact of the CT EITC on individuals and families is immense. For every EITC dollar a beneficiary earns, they return $1.24 to the economy, supporting local businesses and communities.

Our next action is to create a fully refundable Connecticut child tax credit for families, which is based on the federal child tax credit. This tax credit is important because it helps reduce the high costs of raising children for nearly 123,000 CT families by providing $600 to $1,800 of much-needed flexible income. This tax credit reduces child poverty and invests money in local economies. For every CTC dollar a family receives, they return $1.38 to the economy.

Our next step is to eliminate asset limits for applicants and recipients of Connecticut Temporary Family Assistance. Currently, Connecticut’s assets limit Temporary Family Assistance which requires a family to have less than $3,000 in savings and a car worth up to $9,500 to be eligible for TFA.

Removing this constraint helps families save to escape poverty and maintain essential assets, such as reliable transportation to and from work, child care and essential services. The impact this would have in Connecticut would result in administrative cost savings, as evidenced by the eight states that have already eliminated asset limits: Alabama, Colorado, Hawaii, Illinois, Louisiana, Maryland, Ohio and Virginia.

Finally, we need to adopt an eligibility standard based on the federal poverty line for TFA and Husky C.

This would replace the outdated “need standard” that determines eligibility for temporary family assistance and Husky C (health insurance for people living in poverty who are elderly, blind or disabled) with eligibility standards based on federal poverty limits, similar to other benefits.

This would expand access for the roughly 130,000 Connecticut residents who, despite living in “deep poverty”, do not qualify for essential supports under the current standard. This would provide healthcare to people living in poverty who are elderly, blind or disabled, who are currently being left behind by the nation’s most restrictive Husky C eligibility. The impact this would have would be to increase the stability and health of Connecticut residents and workforce.

We hope to see these improvements made so that those struggling in our community have access to more knowledgeable and comprehensive support. If you would like to see these changes as well, we encourage you to reach out to your elected officials to let them know you support these actions.

To learn more about Connecticut United Ways’ efforts to expand the reach of these programs, please visit CTUnitedWay.org. To find out more about other programs supported by Middlesex United Way, please contact our Community Impact Director Christina Heckart at [email protected]

Shawonda Swain is President and CEO of Middlesex United Way.