CTC Options And Tax Literacy Requirements
Today on Capitol Hill. The House Ways & Means Committee will mark up several bills, including special rules for the taxation of US-based income of certain residents of Taiwan (HR 5988), and a proposal to allow deductibility of charitable contributions to certain organizations for members of the Armed Forces (HR 1432).
Congress has options to improve the child tax credit for low-income families. TPC’s Elaine Maag reviews the ways Congress could expand the child tax credit (CTC). About 19 million of the lowest-income children receive less than the maximum credit of $2,000 per child because their families earn too little. Certain provisions of the CTC could be modified to better aid these families, all at a much smaller fiscal cost than the expanded CTC in place for 2021 under the American Rescue Plan Act. When the CTC was available to families with little or no income in 2021, poverty and hardship declined substantially.
Massachusetts and New York mull requiring high school financial and tax literacy courses. TaxNotes reports (paywall) on lawmakers’ efforts in two states to ensure financial and tax literacy instruction for high school students. A New York State Assembly bill would require a course in financial literacy to graduate from public high school. The course would cover computing state and federal income taxes, understanding net versus gross income, the importance of retirement planning, and managing debt. Massachusetts lawmakers introduced a similar bill that would also include instruction in emerging technologies in the financial industry.
Charitable Giving Coalition urges passage of Charitable Act. The House and Senate have companion bills to restore the charitable deduction for non-itemizers. Congress made the deduction temporarily available to those claiming the standard deduction during the pandemic. TaxNotes reports (paywall) the Charitable Giving Coalition wrote to congressional tax writing committee leaders on Giving Tuesday urging passage of the legislation to reverse the decline in charitable giving.
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