EARN IT Act

To amend the Internal Revenue Code of 1986 to provide for an increase in the earned income tax credit for individuals with no qualifying children, and for other purposes. 1. Short title This Act may be cited as the Enhancing Advancement, Reducing Noncompliance, and Improving Trust Act EARN IT Act 2. Increase in earned income credit for individuals with no qualifying children (a) Percentages The table in section 32(b)(1) 7.65 15.3 (b) Earned income and phaseout amounts The table in section 32(b)(2) of such Code is amended— (1) by striking $4,220 $6,570 (2) by striking $5,280 $11,500 (c) Reduction in minimum age Section 32(c)(1)(A)(ii)(II) of such Code is amended by striking age 25 age 21 (d) Inflation adjustments Section 32(j)(1)(B) of such Code is amended— (1) in clause (i) by inserting except as provided in clause (iii), in the case of (2) by striking and (3) by striking the period at the end of clause (ii) and inserting , and (4) by adding after clause (ii) the following: (iii) in the case of the $6,570 and the $11,500 amounts in subsection (b)(2)(B), by substituting “calendar year 2017” for “calendar year 1992” in subparagraph (B) of such section 1. . (e) Effective date The amendments made by this section shall apply to taxable years beginning after December 31, 2017. 3. Certification of child residency (a) In general Section 32(c)(3) (E) Residency certification requirement A qualifying child shall not be taken into account under subsection (b) unless the taxpayer includes on the return of tax for the taxable year a certification of the same principal place of abode as the taxpayer with respect to whom the determination under section 152(c)(1)(B) is made. Such certification shall be supported by proof, such as letters, records, or affidavits, in a manner substantially similar to the procedures for tax years 2003 to 2005 of a similar requirement that the Secretary used for the study entitled IRS Earned Income Tax Credit (EITC) Initiatives—Report on Qualifying Child Residency Certification, Filing Status, and Automated Underreporter Tests . (b) Effective date The amendment made by subsection (a) shall apply to taxable years beginning after December 31, 2017. 4. Social security number required to claim additional child tax credit (a) In general Section 24(e)(1) No increase in credits shall be allowed under subpart C by reason of subsection (d) of this section with respect to any qualifying child for whom the taxpayer fails to include a valid social security number on such return (b) Effective date The amendment made by subsection (a) shall apply to taxable years beginning after December 31, 2017. 5. Expansion of disallowance period for taxpayers who improperly claim EITC based on reckless or intentional disregard of the rules (a) In general Section 32(k)(1)(B)(ii) of such Code is amended by striking 2 taxable years 5 taxable years (b) Effective date The amendment made by this section shall apply to taxable years beginning after December 31, 2017.

Summary: Enhancing Advancement, Reducing Noncompliance, and Improving Trust Act or the EARN IT Act This bill amends the Internal Revenue Code to increase the Earned Income Tax Credit (EITC) for individuals with no qualifying children and to establish additional requirements for claiming the EITC and the child tax credit. The bill modifies the EITC for individuals with no qualifying children by: increasing the credit and phaseout percentages, increasing the earned income and phaseout amounts, reducing the minimum age to claim the credit, and modifying the formula for inflation adjustments. For a qualifying child to be taken into account for the EITC, a tax return must include a certification of the child's residency. The bill prohibits the refundable portion of the child tax credit (commonly referred to as the additional child tax credit) from being claimed for a qualifying child unless the tax return includes a valid Social Security number for the child. The bill increases from two to five years the disallowance period for taxpayers who improperly claim the EITC due to reckless or intentional disregard of rules and regulations.