- Sens. Mitt Romney, Susan Collins, and Marco Rubio were part of the group who signed the letter.
- The Earned Income Tax Credit helps low- to moderate-income families get a tax break.
- Spouses without children filing taxes together must earn less than $27,380 to qualify for the credit.
A cohort of Congressional Republicans led by Arkansas Sen. John Boozman wrote a letter Thursday to Majority Leader Chuck Schumer and Senate Finance Committee Chairman Ron Wyden in opposition to a measure included in the House of Representatives’ reconciliation bill that they said would “effectively discourage marriage.”
The group criticized a “marriage penalty” in the current draft of the bill that may disqualify some low- and moderate-income families from receiving an Earned Income Tax Credit (EITC).
Couples incur marriage penalties when the taxes they pay jointly exceed what they would have paid if they remained single and filed as individuals, according to the Tax Policy Center.
“Discouraging marriage is not in our country’s best interest and sends the wrong message to our families,” the letter said. “Federal policy should be designed to foster strong marriages, which are the foundation of strong families and strong communities.”
—Senator John Boozman (@JohnBoozman) October 2, 2021
EITC helps low- to moderate-income workers and families get a tax break, which could increase based on the number of eligible dependents, according to the Internal Revenue Service.
Under the American Rescue Plan, a $1.9 trillion package that aided the United States’ recovery amidst the COVID-19 pandemic, the tax break was boosted through 2021 to cover more taxpayers without kids, CNBC reported.
However, a sharp income phaseout, a gradual reduction of a tax credit as a taxpayer’s income approaches the upper limit to qualify for that credit, may cause some couples to incur a marriage penalty.
Single filers are eligible for the credit if they have no children and their earned income is below $21,430, while spouses without children filing together must earn less than $27,380, according to CNBC. Additionally, a single worker with no children may marry someone with a kid, eliminating the benefit altogether or reducing what the spouse with a child could have received if they stayed single, CNBC said.
33 Republican senators, including Mitt Romney, Susan Collins, Tom Cotton, and Marco Rubio, co-signed the letter, which stated that the provision would “build bigger barriers for couples to marry.”
Despite barriers to qualify for EITC, President Joe Biden enhanced the 2021 child tax credit, which has a high-income phaseout — $150,000 for married couples filing jointly — that could offset penalties marriage penalties for some families, Eugene Steuerle, co-founder of the Urban-Brookings Tax Policy Center, told CNBC.
To see if you qualify for EITC, use this tool provided by the IRS.