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Group pushes for billion-dollars worth of tax credits for parents

USA tax form 1040 for US individual tax return. Close-up
orelphoto - stock.adobe.com
USA tax form 1040 for US individual tax return. Close-up

A Michigan group is pushing for a new tax credit to benefit some parents of young children in the state.

The plan would involve giving families with young children who qualify for the earned income tax credit an additional credit. It would be worth $5,000 for children under three and $2,500 for children between the ages of three and six.

The non-partisan, non-profit think tank, Michigan Future, Inc. is gathering support for the policy suggestion, it’s calling the working parents tax cut.

Angelique Power is a board member of the group “Michigan Future, Incorporated.” She says this system could benefit many more families than the state’s current child subsidy efforts.

“This proposal is the only way to get to scale, suddenly, being able to help 250,000 children in one year alone,” Power said.

The estimated cost of the plan would total around a billion dollars.

Michigan Future CEO Louis Glazer said, despite the cost, Michiganders polled by his organization, with the help of Impact Research, support the policies.

“It gross benefits everybody. Six in ten Michigan jobs don’t pay enough to support a middle-class family of three. This is a powerful way of helping those families,” Glazer said.

Glazer said the group is working with lawmakers to introduce legislation for the tax cut in the coming weeks.

It’ll be around the time that lawmakers will be working on the state’s next budget.

Rep. Bill G. Shuette (R-Midland) is a member of the House Appropriations Committee. He said he hadn’t yet had a chance to fully evaluate the policy.

But Schuette said he was open to the idea of using the tax code to help families.

“I think we need to be encouraging people all across our state to be starting their families here. And also, we need to be doing everything we can to be making life more affordable for families,” Schuette said.

The state’s expansion of its version of the federal earned income tax credit recently took effect. The governor’s office announced last week that all refund checks from the 2022 tax year that reflect that change had been sent out.

It’s unclear what immediate support adding another credit would receive among lawmakers.

But Democratic Rep. Stephanie Young (D-Detroit), who chairs the House Families, Children, and Seniors Committee, said it’s a conversation starter.

“Every piece of good legislation, be it budgetary, policy, it starts with a conversation. And so, looking at this, and looking how it could potentially be used to help families, is a good conversation,” Young said.

She said it’s possible it could be too late to get a major policy shift like that added to the budget this time around.

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