Congress created the Earned Income Tax Credit (EITC) in 1975 and has since expanded it into one of the nation’s largest anti-poverty programs. It now provides nearly $80 billion per year in tax relief and cash to 30 million low-income working American families, primarily to those with children. In 2025, for a single filer with two dependent children, the maximum credit is around $7,000, a substantial sum for a low-income household. More than half the states and some local governments supplement the federal program.
In June 2025, the Hutchins Center on Fiscal and Monetary Policy and the Center on Economic Security and Opportunity at Brookings convened a group of leading economists from academia, think tanks, and government to look back on the history of the EITC, assess the research on its impact, and look ahead to its future. The first day of our conference was an invitation-only academic roundtable. The second was an hour-long public panel. For a summary of the panel, click here; for the video, click here; and for a transcript, click here.
This report summarizes researchers’ views on key issues from both days, tackling such questions as: Does the EITC increase labor force participation? Beyond the labor supply effects, what other effects does the EITC have? Is there a case for expanding the EITC for workers without children? Is the EITC a good counter-cyclical tool? How extensive are improper payments in the EITC? How might the EITC better align with the Child Tax Credit? We’ve identified areas of agreement and disagreement among researchers, as well as opportunities for continued exploration.
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2025
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