Which of the following problems arise from the Earned Income Tax Credit (EITC)?
A) In the phase-out range of income, workers may experience a disincentive to work
B) The EITC may cause some households to falsely claim the refundable credit
C) It is too complicated and cumbersome
D) All of the above
E) None of the above

Question

Which of the following problems arise from the Earned Income Tax Credit (EITC)? 
A) In the phase-out range of income, workers may experience a disincentive to work
B) The EITC may cause some households to falsely claim the refundable credit
C) It is too complicated and cumbersome
D) All of the above
E) None of the above

Quizplus · Accepted Answer

All of the above problems arise from the Earned Income Tax Credit. The phase-out range of income creates a disincentive to work, as workers may end up losing some or all of their credit as they earn more. The refundable nature of the credit may also lead some households to falsely claim it. Additionally, the EITC is often criticized for being too complicated and cumbersome, making it difficult for some eligible households to claim the credit.

Which of the Following Problems Arise from the Earned Income