Wednesday, 4 May 2022

Does the Earned Income Tax Credit encourage college enrollment?

The Earned Income Tax Credit (EITC)—a cash transfer program aimed at helping low to moderate income workers by giving them a break on their taxes—is not intended as a college subsidy, but the eligibility criteria for it incentivizes families sending children aged 19–23 years to college as this can increase EITC benefits by as much as $4,000 per year. An analysis in Economic Inquiry by researchers at the University of Illinois at Chicago found that in general, EITC recipients are not responding to this incentive as it does not appear to be increasing the rate of college enrollment.  

source https://www.lifetechnology.com/blogs/life-technology-science-news/does-the-earned-income-tax-credit-encourage-college-enrollment