Which of the following statements is true concerning the Earned Income Tax Credit (EITC)?
A) The EITC is a non-refundable credit that can be claimed by poor families with children
B) The EITC lifts many people out of poverty, but it does not change official poverty rates
C) The EITC is a true negative income tax scheme
D) The EITC was introduced as part of the welfare reform measures enacted during the mid-1990s
E) None of the above

Question

Which of the following statements is true concerning the Earned Income Tax Credit (EITC)? 
A) The EITC is a non-refundable credit that can be claimed by poor families with children
B) The EITC lifts many people out of poverty, but it does not change official poverty rates
C) The EITC is a true negative income tax scheme
D) The EITC was introduced as part of the welfare reform measures enacted during the mid-1990s
E) None of the above

Quizplus · Accepted Answer

The EITC is a refundable tax credit that benefits low to moderate-income working individuals and families, and studies have shown that it can lift many people out of poverty. However, it does not change the official poverty rates. Choice A is incorrect because the EITC is actually a refundable credit. Choice C is incorrect because while the EITC operates similarly to a negative income tax, it is not considered a true negative income tax scheme. Choice D is incorrect because the EITC was actually introduced in the 1970s, not the mid-1990s.

Which of the Following Statements Is True Concerning the Earned