Posted by James Financial Services Inc

EITC Includes Family Caregivers

EITC Includes Family Caregivers

We all knew someone who takes care of other people. They are usually our relatives whose husband or a wife chooses to stop working to take care of their sick spouse or our friend who is a young parent who decides to raise his/her newborn and vacate his/her job. It can also be our neighbor who’s willingly spent a day helping his parents who are getting old. No matter what kind of care or who’s doing it, they are all performing the job without getting any compensation for it.

In 2013, the overall amount for the unpaid caregiving was said to be approximately $470 billion, as calculated by the AARP Public Policy Institution. Usually, this is because most of the individuals who offer their hand in taking care of their loved ones lighten their reliance on public service such as nonprofit home care or food assistance and or programs just like Medicaid.

On the other hand, individuals giving care are financially neglected specifically in terms of getting support from the federal government. Though situations from each state may be different, it is an essential condition for individuals who are getting a salary or actively looking for a job to receive benefits such as food stamps or housing support. It is common knowledge that it is necessary for an individual to work and earn money for a minimum of 10years in order to get the claim for benefits of Social Security. One of the best known and useful poverty-alleviating programs in the country is the Earned Income Tax Credit.  It offers a maximum of $6000 for each year as a type of tax credit to poor families, given that they are still earning a certain income.

The goal of this kind of policy is to encourage individuals to work and impart economically. However, the government overlooks the mere fact that unpaid labor alone improves the economy. Emily Rusch quoted that “this type of work is often done by women, and particularly women of color”, this is one of the main reason it is neglected in policies. She added that for a long time now it is the US culture to normally expect women to do work such as home caregiving as free of charge. Rusch is the executive director of CALPIRG which is a nonprofit advocacy organization that supports protections of workers and consumers.

As of now several new policy proposals are being pushed to acknowledge home caregiving as an economically significant job and seeks to integrate it as a category of work that makes someone qualified for the tax credit. The Cost of living refund was being proposed by the Economic Security Project for the expansion of comprehensive EITC. It was authored by Chris Hughes, Dorian Warren and Natalie Foster.

Representative Bonnie Watson Coleman of New Jersey gain support from the ESP for his work on the EITC Modernization Act of 2018 that aims to both boost the value of credit an individual can get and to widen the eligibility to a greater number of individuals. Among the latter category, the main are caregivers who usually slash their personal income-earning jobs or completely resign just to help other people. Watson Coleman stated during the launch of the act that “This bill begins to recognize that the overlooked and often the thankless work of caregiving are essential to our society”. Moreover Watson’s bill will also stretch the student’s credit; in the US around 3 million are striving financially in getting their way into college. In addition, the bill will provide an alternate option for receiving the credit in one shot by offering monthly payments which aim to help individuals in sustaining monthly expenses for the whole year. In California, the same developments are also taking place: ESP led by Governor Gavin Newsom encourages the state to enhance its EITC to shift to a monthly payment system while CALPIRG joins up with Assembly member Buffy Wicks in proposing a bill that aims to extend the work definition that also considers caregivers.

Aside from the modernization and expansion of EITC there are also other courses in resolving the economic need of unpaid workers. One of these is through the proposal of the BOOST Act which is formerly known as the LIFT + Act that further counterfeits basic income by Representative Rashida Tlaib in Michigan. The BOOST ACT will help low-income families receive a yearly stipend of $6000 maximum from the government. In accordance with Tlaib’s bill, an individual who does not earn a single centavo is also qualified for not more than $3000 yearly stipend dissimilar to the EITC’s bill which will only cover those with income. (Resembling bill named The LIFT Act was proposed by Senator Kamala Harris, but it primarily desists the stipend for individuals having zero income). In whatever way, the amount is insufficient but it will be a great help for those very poor families for their basic needs such as food and housing. The bill itself is quite comprehensive to include caregivers who are presently unpaid for their work.

Rusch stated that “As a society, we need to make sure we’re recognizing the kind of work that supports our collective well-being, and that’s where caregiving is a glaring example of the real work that’s needed and has real benefits for society”. She added that this concept actually acquired two-way traction as conservatives acknowledge the value of in-home economically and the reality that it lighten other constrain on governments funding. Broadening the EITC is not sufficient for it does not help individuals who do uncompensated jobs such as caregiving. Whereas modifying the work definition that entitles for credit “is one simple way of recognizing the value of caregiving work” she noted.

James Financial Services Inc
Contact Member