EITC Modernization Act
Sponsored By: Representative Watson Coleman, Bonnie [D-NJ-12]
Introduced
Summary
Modernizes the Earned Income Tax Credit (EITC) by expanding who counts as a dependent and adding a monthly refund option while boosting federal support for free tax help.
Show full summary
- Families and students: Would let more people qualify as "dependents" for the EITC, add a new "qualifying student" category, set a $1,200 minimum credit for qualifying students and certain dependent situations, and lower the age threshold to 18 for some adults without dependents.
- Low-income taxpayers: Would let refundable EITC overpayments above $240 be paid in monthly installments using a 13-part schedule with a larger initial payment followed by monthly payments.
- Tax-prep organizations and underserved communities: Would create a Community Volunteer Income Tax Assistance Matching Grant Program to fund return preparation, training, outreach, and quality reviews; grants would be capped at $30 million a year and must meet a 90 percent accuracy standard.
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Bill Overview
Analyzed Economic Effects
6 provisions identified: 5 benefits, 0 costs, 1 mixed.
EITC starts at age 18
This bill would let workers without dependents claim the EITC starting at age 18. Other EITC rules would still apply.
More EITC for students and families
This bill would let some college students qualify for the earned income tax credit (EITC). You would need to be an eligible student, not be claimed as a dependent, and either have a Pell Grant or income under 250% of the poverty line for your family size. It would also set a $1,200 minimum EITC for qualifying students and for filers who have a specified dependent. For this minimum, children who turned 7 before year-end would not count as specified dependents.
New EITC dependent and ID rules
This bill would change who counts as a dependent for the EITC and add ID rules. It would include seniors you support (age 65+) and certain other qualifying individuals, not just children. You would need to list each qualifying dependent’s name, age, and tax ID, and they must have lived in the U.S. more than half the year.
Higher monthly EITC after baby
If enacted, this would adjust monthly EITC payments when you have a new child. If a baby is born or adopted in the next tax year, and before the second-to-last month you are eligible for payments, later payments would be recalculated as if the child counted for the earlier year. For adoptions, the IRS could accept other identifying info to confirm the child.
More free tax prep help
This bill would fund matching grants for community tax prep programs that help low‑income and underserved people. The IRS would set rules, give priority to programs that reach these groups, and require strong quality checks. Unless Congress sets more, total grants would be capped at $30 million a year.
Take your EITC monthly
This bill would let you get an eligible refund in monthly EITC installments. If your refund is over $240 and not more than your EITC, you could choose monthly payments. First-time users would get 4/13 up front; others get 2/13, then 1/13 each month for 11 months, with interest. Payments would be by direct deposit or prepaid card, not by check.
Sponsors & CoSponsors
Sponsor
Watson Coleman, Bonnie [D-NJ-12]
NJ • D
Cosponsors
Rep. Hayes, Jahana [D-CT-5]
CT • D
Sponsored 1/31/2025
Rep. McIver, LaMonica [D-NJ-10]
NJ • D
Sponsored 1/31/2025
Del. Norton, Eleanor Holmes [D-DC-At Large]
DC • D
Sponsored 1/31/2025
Bishop
GA • D
Sponsored 1/31/2025
Johnson (GA)
GA • D
Sponsored 1/31/2025
Thompson (MS)
MS • D
Sponsored 1/31/2025
Rep. Clarke, Yvette D. [D-NY-9]
NY • D
Sponsored 1/31/2025
Cherfilus-McCormick
FL • D
Sponsored 1/31/2025
Rep. Ansari, Yassamin [D-AZ-3]
AZ • D
Sponsored 1/31/2025
Rep. McDonald Rivet, Kristen [D-MI-8]
MI • D
Sponsored 1/31/2025
Wilson (FL)
FL • D
Sponsored 1/31/2025
Rep. Kamlager-Dove, Sydney [D-CA-37]
CA • D
Sponsored 1/31/2025
Mfume
MD • D
Sponsored 1/31/2025
Rep. Foushee, Valerie P. [D-NC-4]
NC • D
Sponsored 1/31/2025
Rep. Brown, Shontel M. [D-OH-11]
OH • D
Sponsored 1/31/2025
McClellan
VA • D
Sponsored 1/31/2025
Rep. Tokuda, Jill N. [D-HI-2]
HI • D
Sponsored 2/25/2025
Roll Call Votes
No roll call votes available for this bill.
View on Congress.gov