State CTC and EITC
CO: Colorado Fiscal Institute Impact Report
01. 31. 2018
The Expanded EITC would reduce Poverty by 8% and Child Poverty by 11%.
This originally appeared in the Colorado Fiscal Institute
This memo outlines the impacts of an expanded Earned Income Tax Credit (EITC) proposal that would offer either a $1000 basic credit or up to 30% of the federal credit for Coloradans with income less than $70,000—targeting middle class Colorado households as the median household income is $65,685. The expanded EITC proposal would expand the reach of the state EITC to cover students and some caregivers. The proposed expansions are to be funded by increasing the state income tax rate on earners with more than $500,000 in taxable income—the top 1.1 percent of tax filers in Colorado. The income tax rate for taxpayers with taxable income above $500,000 would increase to around 11.8%.