Cash tax credits give economic power back to people
Direct payments through tax credits empower families to meet their basic needs, and to get ahead.
Cash is the currency of life – it’s what we use to provide food and housing for ourselves and our families, to pay for childcare, to get to and from work, to buy what we need. Cash offers the freedom to make choices, and the resources to create stability. And cash–when provided directly through targeted tax credits to the people who need it most – becomes one of the most powerful, practical tools available for people to be able to meet their needs and have agency over their lives.
While the federal government is the biggest player in providing cash tax credits, states play a critical role. States can respond to the needs of local communities, filling in gaps in the federal scheme to address people’s specific needs. By making sure cash goes to those who need it, states can ensure the biggest impact for the maximum number of families.
Thirty-one states, alongside Washington D.C. and Puerto Rico, provide direct cash transfers in the form of tax credits–typically Earned Income Tax Credits to boost low wages, and increasingly, Child Tax Credits to support families. States structure these credits in a myriad of ways, but like their federal counterparts, state credits often have exclusions or conditions that limit their reach and effectiveness. For example, many tax credits have income requirements, which means people who engage in work that doesn’t earn a paycheck — like taking care of young kids or getting a college degree — aren’t eligible. Some state tax credits exclude non-citizens, even though they pay taxes just the same. And outmoded tax filing systems put the burden on people to overcome a complicated and expensive process just to provide information that in many cases the state already knows. Finally, although we know that paying credits monthly supercharges their impact (for the same amount of money), most states still pay out only once a year, in a lump sum.
So even though we know that unrestricted cash through generous, automatic and monthly tax credits is a simple solution to address poverty and the rising cost of living, many existing state tax policies perpetuate outdated, complicated, exclusionary and often racist systems. We’re working to change this.What We Do
We bring together individuals, organizations, and like-minded lawmakers around the idea that unrestricted cash is the most efficient and effective way to improve people’s lives. We help build and support state campaigns headed by changemakers on the ground and give them the resources they need to build powerful coalitions of experts, communicators, organizers, and advocates. We advance bold ideas to transform state tax codes into mechanisms for getting unrestricted cash to families. Our goal is a network of state tax credits that are generous in value, inclusive in eligibility and modern in administration. We want to see the states pick up where federal tax credits leave off, so that people of every state can rely on direct cash payments when they need financial support.
Ultimately, we are laying the groundwork for a national guaranteed income–because people know best how to use the money to make their lives better.Impact
We’re supporting campaigns in states across the country – resulting in wins that have delivered millions of dollars in people’s pockets. We and our in-state partners have worked together to pass bills that eliminate income requirements, and increase the amount of cash delivered while expanding eligibility for young people, the elderly, immigrants, and low and middle-income families.
Deputy State Campaigns Director
Illinois Policy and Advocacy Director
California Campaign Director
Vice President, Build the Field
Communications and Digital Manager
Campaigns Research Director