March 12, 2021 Young Lawyers Corner

Encouraging Work and Eliminating Poverty: Comparing American and Canadian Family Tax Benefits

By Matthew Pick, Harvard Law Class of 2022

Taxes are often used to promote a smorgasbord of social policies. Governments throughout history, for example, have used tax rules to promote their concept of the ideal family. Some rather draconian taxes have been enacted to promote population growth. For example, ancient Rome taxed unmarried men and women and married couples without children.1 More recently, Ceausescu’s Romania taxed families with fewer than five children, in addition to using an array of other authoritarian policies to promote population growth. The result in Romania led to many children being abandoned to orphanages.2 Modern western democracies have used softer tax incentives and have focused on promoting work and alleviating childhood poverty. Nonetheless, colliding social policy goals can beget policies that frustrate one another.

Canada and the United States both use the tax code to promote work among poor families and lift children out of poverty.

Canada and the United States both use the tax code to promote work among poor families and lift children out of poverty.

fizkes / iStock / Getty Images Plus

Colliding Public Policy Goals

In Autumn 1931 sociological researchers descended on the small Austrian town of Marienthal in order to study the effects of chronic and widespread unemployment following the collapse of the town’s major employer.3 While the study chronicled many families’ struggles with material well being—having enough to eat, clothing to wear etc.—the final chapters discuss the collapse in civic life. The authors noted that residents of Marienthal were less likely to vote, join clubs, or even borrow books from the library, even though Marienthalites without a job had more time to engage in all of these activities. The lack of work began to infect the psyche of the community in peculiar ways. The men who by and large did not engage in labor walked slower through the streets than their wives who spent their days working in the home, albeit unpaid. Hopelessness, not anger, reigned supreme. Upon the conclusion of the study, the authors stated flatly, “[w]e entered Marienthal as scientists; we leave it with only one desire: that the tragic opportunity for such an inquiry may not recur in our time.”4

This study raises a question that both Canada and the United States have struggled to answer. North America has numerous cities that struggle with the societal decay that comes with chronic unemployment. Consider the Middletown of J.D. Vance’s Memoir following the slow decline of the steel industry.

[In Middletown] … [y]ou watch as teenagers find themselves in dire straits, … the statistics are stacked high against them, and many succumb. To crime and early death at worst—to domestic strife and welfare dependency at best.5

Or consider Newfoundland’s coastal villages following the cod fishing moratorium.

Economically, the moratorium was savage. … Culturally, the hit was greater. … The historic coastal communities [of Newfoundland] … are now … shells of their former being, places to visit more than to live in, and sirens for tourists. Heartstoppingly de-animated vessels of nostalgia.6

To best promote healthy, vibrant and viable communities, how should Canada and the United States deal with their very own Marienthals? When it comes to creating a tax policy, the two goals of alleviating poverty and encouraging work can conflict with one another. A policy that puts the alleviation of poverty at the fore may discourage low-income families from employment. On the other hand, a policy that requires that parents work to receive any benefit will provide little or no benefit to the most destitute families. This is essentially the trade-off that Canadian and American policy makers have had to wrestle with when designing family tax credits. The key U.S. tax policy is the Earned Income Tax Credit (EITC), and the key Canadian tax policy is the Canada Child Benefit (CCB).7

In the United States, low-income taxpayers may qualify for the EITC, a program that was created as assistance for the working poor. It provides a subsidy to earned income by reducing the tax liability that would otherwise apply and, in some cases, provides a direct payment to the taxpayer. While the program is available to tax filers with no dependents, the credits are considerably higher for those who do have dependents.8 The EITC is a “refundable” credit, meaning that eligible persons who owe no taxes or whose tax liability is less than their EITC will receive all or part of the EITC as a payment. As the name suggests, however, the EITC only supplements earned income. A taxpayer with dependents who relies on welfare or Social Security for income will receive no benefit from the EITC. Those amounts are included in the adjusted gross income, along with any wages earned, so may push income for a low-income worker above the threshold for the EITC.9

In Canada, Canadian residents who are primarily responsible for a child under 18 are eligible for the CCB, based on the “adjusted family net income” as reported on the last year’s tax return. This provision ensures the benefit goes to those who earn the least, with the maximum payment per child ($6765 for a child under 6 and $5708 for children between 6 and 18) going to all who have an income below a certain amount ($31,711 in 2021).10 No distinction is made between earned income, social benefits or investment income. While there is no phase-in, there is a gradual phase-out to ensure wealthy Canadians do not receive the benefit. Thus, a Canadian with no earned income and very little other support can receive the maximum CCB per child, while an American with no earned income cannot receive the EITC, even if the American’s family has several children living in poverty.

Program Origins

The differences described above—an EITC that requires means testing and is increased for families with more earned income versus a CCB that provides the largest benefit to all families, on a per-child basis, that are below a certain income threshold—stems from the purposes driving the enactment of the two laws. In the United States, the EITC’s early champions fervently believed in the inherent dignity of work. In contrast, the CCB is the progeny of a long line of government tax benefits with the sole stated purpose of providing financial assistance to low-income families.11

The first Canadian family allowance, enacted in 1945, was the brainchild of Father Leon Lebel, a Quebec Jesuit priest who claimed that Canadians would move to the United States for better opportunities without such a benefit.12 Speeches at the time, however, urged passage to provide a minimum standard of living for children and promote equality of opportunity. At the outset, there was no means testing and nearly all families in Canada received the benefit. By 1993, the family allowance had been joined by two child tax credits– one refundable and one non-refundable.13 It was a cumbersome program.

This mismatched troika of child benefits was inequitable, complicated and surely incomprehensible to most parents. … The core aims of child benefits—reducing poverty and helping parents with their childrearing costs—were in tension.14

Canada replaced the three programs in 1993 with a single refundable Child Tax Benefit that decreased as incomes rose and then later in 1998 instituted a similar program that included a basic benefit for most Canadians and an additional targeted benefit for low-income families. The Harper government in 2006 added two new child benefits in 2006—a flat, taxable benefit available to all and a non-refundable credit—that lasted no longer than the Harper government. In 2015, the Trudeau government restored the principles of the 1993 benefit, with the main difference being that the CCB provides no benefit for high-income Canadians. The phase-out was a flagship promise of Trudeau in 2015.15 Thus, this history shows that tax benefits in Canada have largely stayed universal. Canada’s child benefits only have a phase-out and have never required earned income to receive the maximum benefit (except, arguably, in the case of the relatively short-lived non-refundable tax benefits).

The history of the U.S. EITC is more complicated. The EITC has the joint goals of helping poor families and encouraging welfare recipients to work.16 This has left many American families in the paradoxical situation of being too poor to receive child benefits.17 In the 1960s-70s, U.S. legislators focussed on moving Americans away from welfare and into work. Louisiana Senator Russell Long proposed a “work bonus” in order to encourage more low-income Americans to choose paid employment over welfare.18 He argued that such a bonus would level the playing field between welfare and paid employment, and prevent taxes pushing people onto welfare. This was part of a long-term denigration of welfare as humiliating. Long stated that “it is far better to provide the working man some tax relief than it is to provide him with welfare. … It is far more dignified and the benefits are entirely work-related.”19 Florida Senator Lawton Chiles expressed his delight with the work bonus compared to welfare that “take[s] away a mans pride [in labor].”20 When the first “earned income credit” was enacted in 1975, the Senate Finance Committee report outlined three goals: (1) providing relief to families who hurt by rising food and energy prices; (2) providing an additional incentive for low-income people to work; and (3) stimulating the economy through additional spending.21 The credit was intended mostly for couples with children since such families were most likely to be using federal welfare programs, which were presumed to provide the strongest disincentive for work. Over the following decades, the EITC became more generous and broader. In 1990, the value of the credit was increased for families with more children, indicating that reducing childhood poverty had become at least a partial justification for the program.22 A paltry benefit for childless workers was added in 1993—even in 2018, about one-fifth of EITC claimants had no children, but received only $2 billion in benefits, compared to a total EITC of $64 billion. These EITC expansions occurred against the backdrop of welfare-to-work reforms that forced low-income parents to work to receive other social assistance.23 What was once a mere afterthought comprising less than half of one percent of the $300 billion in federal outlays in 1975 now costs over $60 billion and comprises one of the largest federal cash transfers.24

Non-Income Qualifications

In general, the EITC is more flexible than the CCB in terms of the relationship between the child and the claimant, in that relatives of the child, such as older siblings, may claim the credit so long as the relative lives with the child. This creates a situation where many individuals could potentially claim the same child as a EITC dependent.25 This can ensnare the very taxpayers the measure is intended to help. Furthermore, the regulations governing who can claim a dependent for EITC purposes are at best difficult to understand and at worst, Kafkaesque. Taxpayers may mistakenly claim the EITC benefit, only to have it taken away by the IRS later, possibly incurring a significant penalty. An earlier statistic touted by the IRS estimated that about a quarter of all EITC claims are incorrect.26 It is likely that most incorrect claims stem from the complexity of the rules.27

In contrast, the CCB provides a benefit to a wider group of people, including temporary residents who have lived in Canada for more than 18 months and refugees before they have had their claim adjudicated.28 The CCB generally requires that the benefit follow custody of the child. One primary caregiver (in the case of a opposite-sex couple, the female parent) claims the benefit, based on who the child spends more time with. The Canada Revenue Agency will also divide the CCB evenly between two parents that share custody of children. These requirements may make it difficult to cover children who grow up in multi-generational homes that share much of the childcare responsibilities. Nevertheless, the lack of flexibility can make it simpler for taxpayers to determine if they are eligible for the benefit. This has led to a much lower rate of incorrect claims in Canada than the US.29

Comparing the Benefits under the Canadian and U.S. Programs

Let’s consider two hypothetical taxpayers in 2020.30 Andrea is a 30-year old single mother of a 5-year old daughter living in Forks, Washington, a state with no state income tax. Across the border in Bamfield, British Columbia lives Carolyn, another 30-year-old single mother of a 5-year-old daughter. Neither Andrea or Carolyn receive any child support and both have sole custody of their daughters. Both Andrea and Carolyn are employed full time and earn 30,000 USD.31 Andrea files as Head of Household in the United States and receives the EITC for her household. Carolyn, like all Canadians, files her taxes independently. She does not have any deductions outside of her deduction for her dependent.32 Carolyn receives the CCB. For the purposes of calculation, assume that both Carolyn and Andrea also fulfill any non-income requirements for their respective programs.

Andrea will qualify as a head of household for a standard deduction of $18,650. She will receive a $2,000 refundable child tax credit that eliminates the rest of her federal income tax liability and provides an $865 refund.33 Washington has no state income tax.34 In addition, Andrea will receive an EITC of $1,879. While Andrea will owe no income tax over the course of the year, she will still have FICA contributions withheld (Social Security 6.2% and Medicare1.45%) of 7.65%, or $2,295 ($191.25 per month).35 After taxes, FICA contributions and EITC credits, Andrea would have an after-tax income of $30,449. Any refund Andrea receives for withheld taxes, her refundable child credit and her EITC credit will come to her in one fat check early in the following year.

In contrast, Carolyn will owe income taxes every month to both the federal and provincial governments, which will be deducted at source. TurboTax calculations show that she will owe 1819.58 CAD ($1364.69) to the federal government and 897.67 CAD ($673.25) to the provincial government. Carolyn will also have to contribute 5.1% of earned income to the Canada Pension Plan (1861.50 CAD or $1396.13)36 and 1.62% to Employment Insurance (648 CAD or $486).37 In total, Carolyn will pay CAD 5226.75 ($3920.06) over the course of the year in taxes and contributions. Carolyn would receive 515.39 CAD monthly in Canada Child Benefit payments. In addition, Carolyn will receive 133.33 CAD monthly in B.C. Early Childhood Tax Benefit payments. Carolyn will also receive 168.08 CAD quarterly in GST/HST credits, and 87 CAD quarterly in BC climate action tax credits.38 This totals 8,804.96 CAD per year ($6603.72). Taking into account taxes, CPP and EI contributions, and credits, Carolyn will have an after-tax income of 41,376.97 CAD ($31,032.73).

Carolyn will be in a net better position than Andrea, but the difference is not huge –$583.73 or a little less than 2% of their respective gross incomes. Carolyn will have significantly more transactions with the government. This may make the various programs less administrable and may also present logistical difficulties and check cashing fees for the underbanked and transaction fees for the overbanked. In general, Andrea will receive more tax relief and a much smaller EITC payment. Carolyn, in contrast, will pay provincial and federal taxes over the course of the year but receive more benefits over the course of the year. Since money is fungible, it probably matters very little to a low-income taxpayer whether or not they receive assistance in the form of government benefits or tax relief.

Timing of Payments

Although the magnitude of payments and taxes are almost a wash between Carolyn and Andrea, the timing of the payments is not. In the United States, an EITC tax refund provides a significant annual lumpsum to low-income families. Carolyn will likely receive a tax refund for overcontributions spread across the year.39 These refunds can have a wide array of impacts. For some who owe balances to the IRS, the entire tax refund, including EITC payments, will be applied to their tax debts.40 In these cases, the advantage of a lumpsum refund is lost. In the absence of tax debts, taxpayers may use their refunds for one-off expenses, including paying court fees to file for bankruptcy41 or paying back non-tax debts accrued over the course of the year.42 Paradoxically for a program intended to encourage paid work, some Americans may use their EITC refund to extend a period of unemployment falling around the time of their tax refund.43

Canada smooths payments across the year, which may allow for more predictable budgeting and less reliance on high-interest credit. Nevertheless, for certain groups of people, receiving money even as infrequently as once a month can present risks. Paramedics in Vancouver, Canada report seeing an increase in drug overdoses on the day of the month when social assistance checks are deposited.44 In the United States, mortality increases in the first week of the month (closer to when Social Security checks are issued) than in the last week of the month.45 While issuing monthly benefit checks may solve some of the financial problems that low-income households have, it is not particularly popular. In the past, American taxpayers have had the option of receiving a portion of their estimated EITC along with their paycheck over the course of the year.46 Even though this would give EITC recipients money sooner, very few (~2%) choose this option.

Some behavioral economists consider the lumpsum nature of EITC payments a positive since taxpayers see tax refunds (and EITC payments) as a different type of income and are more likely to use them to pay for large purchases. In effect, the single payment acts as a savings plan over the course of the year, forcing self-control and allowing taxpayers to make significant financial moves that they could not have done otherwise.47 Whether or not a single lumpsum for family benefits is a positive thing probably depends mostly on what it replaces. If the lumpsum replaces a savings account, enforcing financial discipline on recipients, then an annual payment is preferable. If the lumpsum is used to pay off payday loans that would not have been taken had the benefit been paid monthly, then more frequent payments are preferable.

Marginal Tax Rates

What if Carolyn and Andrea were offered promotions? They would need to evaluate if it would be worthwhile to take the promotion based on their particular circumstances. The drawbacks of the promotion—additional time at work, additional stress, etc.—must be weighed against the additional income. These decisions are inherently personal, with multiple factors. A rational taxpayer would, however, consider any additional tax they would pay to determine the net income they would receive. Carolyn and Andrea would consider not only the additional taxes due but also any benefits foregone because of the additional income. They are both in the “phase-out” of benefits, so any additional money will be subject to clawbacks.

Since Andrea’s child tax credit is refundable, she will not have additional income tax liability but will lose her refundable benefit dollar-for-dollar, effectively making the income subject to her marginal tax rate of 10%. Andrea will also owe the 7.65% FICA tax on any additional earned income. Since Andrea is in the EITC phase-out portion, her EITC will be clawed back at 15.98%.48 Andrea’s effective tax rate on the raise is thus 33.63%, a rate that ordinarily applies to those with more than $200,000 of ordinary income.

Carolyn’s wide array of benefits are subject to different clawbacks. She will pay additional income taxes (and EI/CPP contributions, since she is not yet at the maximums for those benefits) on any additional income. Her marginal federal and provincial tax rates are 15%, and 5.06%, respectively. Her CPP and EI rates total 6.72%. Her CCB will be phased out at 7%.49 Her GST/HST tax credit will be clawed back at 5%.50 She has not yet reached the maximum on her B.C. Early Childhood Tax Benefit (CAD 100,000), but her Climate Action Tax credit will clawback at 2% when she reaches the maximum (CAD 41,706). Carolyn will thus face a marginal tax rate on the raise of 38.78%, a rate ordinarily applicable to Canadian incomes of considerably more than CAD 100,000.51

Carolyn thus faces a higher effective marginal tax rate than Andrea. Both are faced with far higher rates on the additional income than they might expect from their ordinary tax rates. Interestingly, this means that they both fall into a category that Senator Long wanted to avoid—one in which the economic calculation falls on the side of retaining current benefits rather than accepting additional paid employment.

Proposals for Different Family Benefits in Both Countries

In the United States, the Center for Budget and Policy Priorities has proposed a system to replace the child tax credit that is more like the CCB.52 In exchange for his support for the 2017 tax legislation, Marco Rubio proposed a significantly enhanced child tax benefit that would be refundable from the first dollar.53 The $1.9 trillion COVID-19 relief bill before Congress (the House may vote on passage of the American Rescue Plan Act, as amended by the Senate, as early as the week of March 8) expands the U.S. child tax credit to $3000 per child and $3600 for children under six years old and makes the credit fully refundable for 2021.54 It also instructs the IRS to establish a program to provide advances on the credit through monthly installments. Similarly, during the 2019 Canadian general election, party platforms reflected a relatively narrow set of changes to the CCB, possibly indicating political consensus about changes. The governing center-left Liberal Party created the current CCB version. Ironically, it offered the most substantive proposal to increase the benefit by $1000 for children under the age of 1.55 The right-leaning Conservative Party did not propose CCB changes but did call for a refundable tax credit for children to take arts classes or sports.56 Since this would be creditable at 15% long after the expenses were incurred, there would likely be little uptake from low-income households. The left-leaning New Democratic Party platform included mention of a universal income pilot that would potentially replace the CCB.57

Conclusion

Canada and the United States both use the tax code to promote work among poor families and lift children out of poverty. Whether or not the U.S. EITC or the Canadian CCB is the better program is a value judgement. Should the primary goal of low-income family tax credits be encouraging work or should it be providing financial relief to the most destitute? Decades ago, Canadian Prime Minister William Lyon Mackenzie King and Louisiana Senator Russell Long answered this question differently. Their two countries still do. 

  1. 1 Harry Thurston Peck, Harper’s Dictionary of Classical Literature and Antiquities 38 (1897) (“Aes uxorium. A tax paid by men who reached old age without marrying, and first imposed by the censors in B.C. 403”).
  2. See Daniela Dr ghici, A Personal View and Timeline of Women’s Sexual and Reproductive Lives in Romania, 9 Analize—J. of Gender & Feminist Stud. 148, 150–53 (2017).
  3. Christian Fleck, Introduction to Marie Jahoda et al., Marienthal: The Sociography of an Unemployed Community (Routledge 2017) xii (1971).
  4. Id. xii (quoting page 98).
  5. J.D. Vance, Hillbilly Elegy: A Memoir of a Family and Culture in Crisis (HarperAudio 2016) Ch. 15 at 11:32.
  6. CBC News: The National – How the fishery moratorium savaged Newfoundland | Rex Murphy.
  7. There are, of course, other programs in both countries. Americans can use Section 8 housing vouchers and, if they satisfy a work requirement, use the supplemental nutritional assistance program (SNAP). See 42 USCA § 1437f (housing vouchers); SNAP, U.S. Dep’t of Agric. There are also state welfare benefits, often with work requirements. Social Security also comprises a form of unemployment assistance for millions of Americans. See e.g. Terrence McCoy, Disabled or Just Desperate?: Rural Americans turn to disability as jobs dry up, Wash. Post (Mar. 30, 2017). Canadians can use various provincial programs. Ontarians with no working income can enter an income support program if disabled. Ontario Disability Support Program – Income Support, Ontario Ministry of Children, Community and Social Services. there is a monthly supplemental benefit for workers in need as well. Monthly Ontario Works Amounts, City of Toronto.
  8. For example, compare a single parent with one dependant who had $15000 in earned income with a single person with no dependents with the same earned income in 2019. The single parent would receive an estimated EITC amount of $3526, while the individual without a dependent would only receive an EITC amount of $42. See IRS, Use the EITC Assistant.
  9. See Social Security Administration, Social Security Programs in the United States—Earned Income Tax Credit, at 104–06.
  10. Canada Revenue Agency, Canada Child Benefit: how the benefit is calculated.
  11. Canada Revenue Agency, Canada child benefit: Overview.
  12. Robert Douglas Weaver, Understanding the Present by Exploring the Past: An Analysis of Family Allowance and Child Care in Canada 17–19 (2000).
  13. Ken Battle, Caledon Institute of Social Policy, Child Benefits in Canada: Politics Versus Policy, 3 (2015).
  14. Id. at 4.
  15. “Our Canada Child Benefit helps families that need it. [Then federal Conservative party leader] Harper and [then federal New Democratic Party leader] Mulcair would keep sending cheques to millionaires.” @JustinTrudeau, Twitter (Sept. 17, 2015, 7:21 PM).
  16. Margot L. Crandall-Hollick, The Earned Income Tax Credit (EITC): A Brief Legislative History, 2–3 Congressional Research Service (2018).
  17. There were at least 13 million working-age Americans on disability as of 2017. The vast majority of these Americans do not have earned income. Center on Budget and Policy Priorities, Chart Book: Social Security Disability Insurance 19 (2019).
  18. 118 Cong. Rec. 33,010 (1972) (statement of Sen. Long). In its initial conception, the work bonus would provide 10% on every dollar that a family earns up to $4000, then would be phased out at 25%. The percentage was chosen to approximately accord with the total social security contributions paid by low-income workers (then about 12%, evenly split between employer and employee).
  19. Id.
  20. Id. at 33011 (statement of Sen. Chiles).
  21. S. Rep. No. 94-36, at 11 (1975).
  22. Omnibus Budget Reconciliation Act of 1990, Pub. L. No. 101-508, § 11111 (1990).
  23. See generally Robert A. Moffitt, The Brookings Institution, From Welfare to Work: What the Evidence Shows (2002).
  24. IRS, Table 2.5: Returns with Earned Income Credit (2019).
  25. IRS, Pub. 596: Earned Income Credit 10 (2020).
  26. The IRS webpage on EITC fraud claims is apparently no longer available. Some conservative commentators have claimed that this flexibility leads to “benefit shopping” whereby families could choose a relative to claim the EITC to procure an inflated credit. See e.g. Robert Rector & Jamie Hall, Reforming the Earned Income Tax Credit and Additional Child tax Credit to End Waste, Fraud, and Abuse and Strengthen Marriage, The Heritage Foundation (Nov. 16, 2016).
  27. Robert Greenstein et al., Reducing Overpayments in the Earned Income Tax Credit, Center on Budget and Policy Priorities (Jan. 31, 2019).
  28. Canada child benefit: Who can apply, Canada Revenue Agency; Immigration and Refugee Protection Act S.C. 2001, c.27 s. 95(2).
  29. See, e.g.Ottawa on Lookout for Child Benefit Fraud, CTV News (0.25% fraud rate for child benefits in Canada). But see Hamilton man fined more than $155K for fraudulent child tax benefit claimsCanadian Broadcasting Corporation (man committed benefit fraud by creating fake children).
  30. This analysis will only consider cash tax benefits. Some of the calculators are more readily available for 2019, but there were no major tax changes in the relevant jurisdictions, so there should be minimal error.
  31. The USD/CAD exchange rate has hovered around 1.33 for the past few years so this assumes that Carolyn earns 40,000 CAD.
  32. No deductions is a far more realistic assumption for Andrea than Carolyn. Low-income Canadians can claim deductions, for example, for tuition. Eligible Tuition Fees, Canada Revenue Agency).
  33. The IRS Calculator for 2020. provides Andrea a standard deduction of $18,650 and taxable income of $11,350, placing her in the 10% tax bracket. She would receive a $2000 child credit, which would eliminate her $1,135 tax liability. The remainder of this tax credit is refundable since 15% of Andrea’s earned income of $30,000 is $4,500 more than the $2,000 credit, resulting in a $865 refund, in addition to a refund of any taxes that she paid over the year. I.R.C. § 24.
  34. Income Tax, Department of Revenue Washington State. Most states have a state income tax, and some have a state EITC. See, e.g., Maine: Me. Rev. Stat. tit. 36, § 5219-S (1).
  35. https://www.ssa.gov/OACT/COLA/cbb.html.
  36. Canada Revenue Agency announces maximum pensionable earnings for 2020, Canada Revenue Agency. The first $3500 of income is exempt from CPP contributions.
  37. EI premium rates and maximums, Canada Revenue Agency.
  38. Calculator was used to arrive at this calculation. Other provinces have different child tax credits.
  39. A Canadian taxpayer can file form T1213 (or its provincial equivalent) to reduce the tax deducted at source. T1213 Request to Reduce Tax Deductions at Source, Canada Revenue Agency, but few do so.
  40. IRS, Refund Inquiries.
  41. See generally Tal Gross, Matthew J. Notowidigdo & Jualan Wang, Liquidity Constraints and Consumer Bankruptcy: Evidence from Tax Rebates, 96 Rev. of Econ. & Statistics 431 (2014).
  42. Ruby Mendenhall et al. The Role of Earned Income Tax Credit in the Budgets of Low-Income Households, 86 Social Sci. Rev. 367, 375 (2012). See also Vance supra note 9, Conclusion 4:36 (noting that tax refunds were “the ultimate backstops” for poor families).
  43. Sara LaLumia, The EITC, Tax Refunds, and Unemployment Spells, 5 Am. Econ. J. Econ. Pol. 188, 188 (2013).
  44. British Columbia Centre on Substance Abuse, The Cheque Day Study Community Impact Statement 21 (2019).
  45. David P. Philips, Nicholas Christenfeld, & Natalie M. Ryan, An Increase in the Number of Deaths in the United States in the First Week of the Month, 341 New Eng. J. Med. 93, 93 (1999).
  46. Jennifer L. Romich & Thomas Weisner, How Families View and Use the EITC: Advance Payment Versus Lump Sum Delivery, 53 Nat’l Tax J.
  47. Id.
  48. § 32(b)(1).
  49. See supra n. 17.
  50. Goods and services tax/harmonized sales tax credit - calculation sheet for the July 2020 to June 2021 payments (2019 base year), Canada Revenue Agency.
  51. Canadian income tax rates for individuals – current and previous years, Canada Revenue Agency.
  52. Arloc Sherman, Center on Budget and Policy Priorities, Canadian-Style Child Benefit Would Cut U.S. Child Poverty by More than Half (2018).
  53. Jeff Stein, What Marco Rubio got for his Tax Vote, The Washington Post (Dec. 19, 2017).
  54. See, e.g., Yelena Bosovik, Senate Passes Latest COVID-19 Stimulus Bill, BKD CPAs & Advisors (Mar. 8, 2021).
  55. Liberal Party of Canada, Forward: A Real Plan for the Middle Class 9 (2019).
  56. Conservative Party of Canada, Andrew Scheer’s Plan for You to Get Ahead 10–11 (2019).
  57. New Democratic Party of Canada, A New Deal for People: New Democrats’ Commitments to You, 60 (2019).