SB 345

Under federal law, the earned income tax credit (EITC) is a refundable tax

credit for low-income workers. If the amount of the claim exceeds the worker's tax

liability, the claimant receives a check for the excess amount from the Internal

Revenue Service. The amount of the credit for which a claimant is eligible is based,

in part, on whether the claimant has no qualifying children, one qualifying child, or

more than one qualifying child.

Under current law, the refundable Wisconsin EITC may be claimed in an

amount equal to a certain percentage of the federal basic EITC. To be eligible for the

Wisconsin EITC, an individual must have one or more qualifying children. The

Wisconsin EITC is equal to 4 percent of the federal credit if the claimant has one

qualifying child, 14 percent of the federal credit if the claimant has two qualifying

children, and 43 percent of the federal credit if the claimant has three or more

qualifying children.

Under this bill, a claimant who has no qualifying children may claim the

Wisconsin EITC in an amount equal to 4 percent of the federal credit.