LANSING, Mich. — Sen. Jeff Irwin (D–Ann Arbor) today introduced a bill that would provide thousands of low-income Michigan workers with more refund money when they file their taxes. Senate Bill 107 would increase the percentage of the federal earned income tax credit (EITC) that Michiganders could claim on their state tax return, from 6 percent to 30 percent.
“The Earned Income Tax Credit is a proven tool for lifting working families out of poverty, and the money it puts into the pockets of the working poor goes right back into our local economies,” Sen Irwin said.
“People all over Michigan are filing their federal taxes and they’re seeing their taxes go up, and that their refunds are smaller or non-existent. Low-income workers are working harder for less, and Michigan can — and should — provide these people some tax relief.”
The EITC has been proven to improve the lives of working Americans for more than 40 years. It incentivizes lower‑income working people to maintain their jobs by effectively boosting their wages and providing benefits so that they can help support their families.
The amount of refund money an individual can receive when filing for the federal EITC depends on income levels where they must make less than:
- $15,270 if single with no qualifying children;
- $49,194 if single with three or more qualifying children;
- $20,950 for families with no qualifying children; or,
- $54,884 for families with three or more qualifying children.
For many of those who qualify to file for the EITC, their refund allows them to spend money on things that keep them working, such as car repairs or child care.
In 2017, the IRS reported that 766,000 Michigan taxpayers claimed the federal earned income tax credit, and received about $2,489 on average, or about $150 from the state credit. If passed, this bill could result in a $547 million boost to local economies.
SB 107 has been referred to the Senate Finance Committee.
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