Federal Tax Reform(Advisory Panel on Federal Tax Reform)

※ 자료:
http://www.taxreformpanel.gov/final-report/
http://www.taxreformpanel.gov/final-report/TaxReform_Ch5.pdf

※ 메모: Chater 5... RECOMMENDATIONS:

Consolidate the standard deduction, personal exemptions, child tax credit, and head of household filing status into a single Family Credit.
Consolidate the earned income tax credit and refundable child tax credit into a single Work Credit.

The tax code separately provides a standard deduction, personal exemptions, the child tax credit, the head of household filing status, the earned income tax credit (EITC), and a refundable child tax credit, which together are designed to serve the important goals of ensuring the tax burden is shared in a progressive manner and removing disincentives to work. As summarized in Figures 5.1 and 5.2, the first of the Panel’s common solutions would simplify filing for individuals by transforming these duplicative and overlapping provisions into just two credits – a Family Credit and a Work Credit.

The Panel recommends replacing the EITC and refundable child tax credit with a Work Credit that builds on the Family Credit. The new Work Credit is designed to maintain a work incentive comparable to that of the current system by providing approximately the same maximum credit as the combined amount of the current-law EITC and the refundable child tax credit. As under the current system, the Work Credit amount would increase as the amount of earnings from work (wages and self-employment income) increases, and the rate and maximum credit amount would be higher for workers who live with qualifying children. For the first year, the Work Credit maximum amount would be $412 for workers with no children; $3,570 for workers with one child; and $5,800 for workers with two or more children. The Work Credit would be adjusted annually for inflation.