OLYMPIA, Wash. (AP) - A bill that would expand a tax credit for low-income workers and families that would start paying out benefits for the first time in 2023 was approved by the Washington Legislature Thursday.
The House, on a 93-3 vote, concurred with changes made in the Senate and the measure now heads to Gov. Jay Inslee for his signature.
The state tax exemption was created in 2008, but has never been funded. Democratic leaders in both the House and Senate have allocated money to the program in their recent budget proposals.
It is modeled in part after the federal Earned Income Tax Credit for low-income individuals and families and uses income qualifications from that program and is meant to offset the state sales tax.
The proposed law is currently projected to pay out $250 million to 420,000 taxpayers in 2023, the first year benefits will be paid out. That amount jumps to $536 million in the next two-year budget cycle that ends mid-2025.
Under current law, the amount of the state benefit is 10 percent of a person’s credit from the federal program or $50, whichever is greater. Under the measure awaiting Inslee’s signature, the base amount would now range from $300 to $1,200, depending on the number of children a taxpayer has. The base amount phases out as income levels increase, with a minimum credit of $50.
For tax year 2021, a single taxpayer with no kids could have earned up to $15,980 and still be eligible for the minimum $50 rebate. For a married couple with more than two kids, that maximum qualifying income would’ve been $51,463 in 2021, according to a nonpartisan analysis.
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