CWLA has endorsed H.R. 2681, Foster EITC Act, sponsored by Congressman Danny Davis (D-IL). The Davis proposal would add an important expansion of the Earned Income Tax Credit (EITC) for youth who were in foster care on or after their 14th birthday. Currently, the EITC disadvantages former foster youth who enter the work force earlier and experience higher rates of poverty than their peers. The EITC is limited to low-income workers aged 25 to 64, with eligibility possible for custodial working parents younger than 25. Although current and former foster youth caring for children may qualify for the EITC, non-custodial parents and single adults cannot.
In support of the proposal, which Davis hopes to get included in a tax reform package, his office points out that approximately 20,000 to 25,000 youth between the ages of 18 and 21 leave out of foster care annually. Former foster youth in their early twenties are more likely to be low-income than their peers and less likely to be in school. The Foster EITC bill expands EITC eligibility to age 18 for youth who were in foster care on or after their 14th birthday. The bill sets eligibility at age 14 to align with other federal statutes, including the Preventing Sex Trafficking and Strengthening Families Act and the Workforce Investment Act, that recognize that youth who have spent time in care as young as age 14 need additional protections and supports.