North Carolina’s Earned Income Tax Credit was one of the state’s most effective pro-work, anti-poverty tools, and false claims that it was riddled with fraud were simply a smokescreen for lawmakers who were shifting taxes from the wealthy onto working families.
Sen. Bob Rucho’s claim of fraud is highly misleading and likely based on flawed studies (“Low-paid, jobless see no joy on Labor Day,” Sept. 3 news story).
Most EITC overpayments are unintentional. The rules to qualify for the credit are very complex, largely because it is designed to reach only the working families most in need. That complexity leads to errors.
To cite just one example, the EITC – unlike the Child Tax Credit – has very strict rules over who can claim a child, and these rules often confuse separated couples. In fact, most of the errors are not even caused by the recipients but by commercial tax preparers, which the IRS is trying to address through training.
The facts here are clear: The Earned Income Tax Credit has helped thousands of hard-working, low-wage people make ends meet. Don’t let Rucho convince anyone otherwise.
Policy analyst, N.C. Budget and Tax Center, a nonpartisan nonprofit.