EARN IT helps working families

grew up in the working class neighborhoods of Aurora, and I fully understand the importance and value of work over welfare.

That’s why I introduced the Enhancing Advancement, Reducing Noncompliance and Improving Trust Act, also known as EARN IT. This bill is a bipartisan effort to expand access to the Earned Income Tax Credit (EITC). It’s an idea that has been lauded by both President Barack Obama and Speaker Paul Ryan, and it’s long overdue.

The EITC is a long-established program to provide tax credits to low-income working Americans and their families. The EITC is especially valuable because it rewards work.

Under current law, the EITC is weighted heavily to benefit low- to moderate-income adult workers over the age of 25 who have children. By contrast, it gives much less help to low-income single adults. For example, a childless worker can only participate in the program with an adjusted gross income below $14,820 and can receive a credit of only $503, while a worker with three or more children with an adjusted gross income as high as $47,747 could receive a credit of $6,242.

The EARN IT legislation expands the credit for childless workers and reduces the eligibility age for all low-wage workers from age 25 to age 21. These changes are important not only because the EITC is a proven and effective antipoverty program, but because the EITC encourages work over welfare. Research shows that a positive attitude toward work and the development of solid work habits leads to better lifetime outcomes and increases the likelihood of achieving financial independence over government dependence.

Expanding the EITC, unlike significantly increasing the minimum wage, does not discourage employers from hiring lowskilled entry-level workers by dramatically raising their labor costs. In 2014, the nonpartisan Congressional Research Office (CBO) studied the likely impact of raising the federal minimum wage from $7.25 to $10.10 an hour, and it concluded that the increase in the minimum wage would result in lifting 900,000 low-wage workers out of poverty but at a cost to the economy of 500,000 jobs. The EARN IT Act would increase assistance for low-wage workers without causing job losses.

The reason the EITC does not harm the economy and cause job losses is because the additional income provided to low-income workers is paid from general tax revenues instead of by employers. Fortunately, I was able to identify a means to cover the cost of this expansion. My legislation covers the additional costs by implementing a recommendation from a 2008 IRS study that proposed to reduce fraudulent and improper EITC payments by implementing verification procedures to make sure that those applying for the payments are truly eligible. The Joint Committee on Taxation estimated that by implementing the IRS plan my bill would generate a savings of $3.7 billion over the next 10 years, far outweighing the estimated cost of my EARN IT legislation.

This legislation also preserves the ability of employers to hire young people seeking their first job opportunity at a training wage. Growing up in Aurora, my friends and I all got part-time jobs to either help out with the family budget or to earn our own spending money. Those part-time jobs were and are still a very important part of growing up, entering the workforce, and learning adult responsibilities.

With a sluggish national economy and stagnant incomes, we must do everything we can to help hard-working Americans. Helping low-wage workers make ends meet and develop job skills by rewarding work is not a partisan issue, but it’s an issue we can

all rally around.

U.S. Rep. Mike Coffman, R-Colo., is a former smallbusiness owner and a Marine Corps combat veteran.