HR-905-119
Referred to the House Committee on Ways and Means.
Sponsored by Bonnie Watson Coleman (D-NJ)
What it does
This bill would expand eligibility for the Earned Income Tax Credit (EITC) by lowering the minimum age for childless workers from 25 to 18, eliminating the maximum age limit, and adding new qualifying dependent categories (including elderly and disabled dependents and spouses). It would establish a minimum EITC amount of $1,200 and allow eligible individuals to receive the credit as monthly payments rather than a lump sum at tax time, with a bonus payment for new parents. The bill would also create a grant program to fund free tax return preparation assistance for low-income and underserved individuals.
Who benefits
Workers aged 18–24 who are currently ineligible for the EITC without qualifying children. Older workers currently excluded by the age cap (previously 65). Caregivers of elderly or disabled dependents and spouses who were not previously covered. Students meeting certain requirements. New parents (biological or adoptive) who would receive increased monthly payments. Low-income taxpayers in underserved communities who would gain access to free tax preparation assistance. Nonprofit organizations and community groups that could receive grants to run tax assistance programs.
Who is hurt
Higher-income taxpayers who may indirectly bear costs if the expanded credit is deficit-financed. Tax preparation companies (e.g., H&R Block, TurboTax) that serve low-income filers and could lose customers to the new grant-funded free preparation program. The IRS and Treasury Department, which would face significant administrative burden implementing monthly payment infrastructure and a new grant program. State tax agencies that may need to coordinate with federal monthly payment systems.
Supporters argue
Supporters argue that the current EITC structure leaves out millions of low-wage workers — particularly young adults aged 18–24 and older workers — who face the same cost-of-living pressures as those who qualify. They contend that monthly payments would smooth income for families living paycheck to paycheck, reducing reliance on high-cost short-term credit, and point to the success of the 2021 expanded Child Tax Credit monthly payments in temporarily cutting child poverty by roughly 30% as evidence that periodic disbursements reach families more effectively than annual lump sums.
Opponents argue
Opponents argue that expanding the EITC to younger, childless workers and adding monthly payment infrastructure would significantly increase program costs and complexity at a time of fiscal strain, without clear evidence that the 18–24 age group faces the same work-incentive barriers the EITC was designed to address. They contend that monthly payments create overpayment and clawback risks — a persistent problem in the existing EITC, which already has an improper payment rate estimated by the IRS at roughly 25% — and that adding new eligibility categories could worsen this compliance challenge.
Constitutional context
The bill falls squarely within Congress's taxing and spending authority under Article I, Section 8, Clause 1 and the Sixteenth Amendment, which permits income-based tax credits without apportionment. The Origination Clause (Art. I, §7, cl. 1) is satisfied as the bill was introduced in the House. No active constitutional tension areas are implicated.
Checks and balances
Congress would expand the credit and create the grant program through statute; the IRS and Treasury would gain administrative authority to implement monthly payments and disburse grants, subject to congressional appropriations oversight and standard audit mechanisms.
Historical precedent
The American Rescue Plan Act of 2021 temporarily expanded the Child Tax Credit and delivered it as monthly payments, providing a direct — though short-lived — precedent for periodic disbursement of refundable tax credits to low-income families.