Bill > HR2764

This bill, the Tax Cut for Workers Act of 2025, makes several significant modifications to the Earned Income Tax Credit (EITC), a tax benefit for low to moderate-income working individuals and families. The bill permanently reduces the minimum age for claiming the credit without qualifying children from 25 to 19 (with exceptions for students and former foster or homeless youth), eliminates the maximum age limit of 65, doubles the credit and phaseout percentages from 7.65% to 15.3%, and substantially increases the earned income and phaseout amounts from $4,220 to $9,820 and $5,280 to $11,610, respectively. Additionally, the bill introduces an inflation adjustment mechanism to periodically update these amounts based on changes in the Consumer Price Index (CPI) and allows taxpayers to elect to use their prior year's earned income if it was higher, which could result in a larger tax credit. The bill also extends the application of the Earned Income Credit to U.S. possessions like Puerto Rico, American Samoa, and other territories with mirror code tax systems. These changes would apply to taxable years beginning after December 31, 2025, potentially providing more financial support to low-income workers.

Budget and Finance

https://www.congress.gov/bill/119th-congress/house-bill/2764/all-info