Boost the Middle Class Act
Boost the Middle Class Act would substantially expand the Earned Income Tax Credit (EITC) under the Internal Revenue Code. The bill increases the earned income thresholds and the income phaseout thresholds used to determine the EITC for the three filing categories (no qualifying children, one qualifying child, and two or more qualifying children). It also raises the income threshold at which married couples filing jointly begin to lose the credit. In addition, the bill updates how the credit is adjusted for inflation, using newer base years. The changes would take effect for taxable years beginning after December 31, 2025 (i.e., starting in 2026). Overall, the measure intends to make the EITC larger and more widely available, particularly for middle- and lower-income families, by increasing eligibility and the value of the credit.
Key Points
- 1The earned income amounts used to calculate the EITC are increased:
- 2- For the three EITC categories, the thresholds move from: 6,330 to 13,629; 8,890 to 19,140; and 4,220 to 9,086.
- 3Phaseout amounts are increased:
- 4- For two categories, the phaseout threshold moves from 11,610 to 24,992 (twice, for the first two categories).
- 5- For the category with two or more qualifying children, the phaseout threshold moves from 5,280 to 11,363.
- 6Married filing jointly (MFJ) phaseout amount increased:
- 7- From 5,000 to 7,612.
- 8Inflation adjustments:
- 9- The indexing years are updated: the base year before application to the credit is shifted (2015 → 2026; 1995 → 2025; 2008 → 2025).
- 10Effective date:
- 11- The amendments apply to taxable years beginning after December 31, 2025 (i.e., starting in 2026).