Three Bills, One Significant Step
Forward in Tax Credit Fairness


This campaign focuses on three legislative bills – H.2761/S.1792, S.1798, and H.2762/S.1793. Collectively, they work to make taxes in Massachusetts simpler, more fair, and more equitable to benefit lower-income working families and individuals throughout the Commonwealth.


The details for each of these bills, and what they do for Massachusetts residents are outlined below:


Learn More: What is the Impact in My Area?

An Act establishing a child and family tax credit


Filed by Representative Decker and Senator DiDomenico (H.2761/S.1792)


This bill would combine and streamline two existing dependent credits into a single Child and Family Tax Credit (CFTC) worth $600 per dependent, inclusive of all children and family sizes.


  • Background

    1) MA currently has two dependent credits that families can choose between: the (1) Household Dependent Tax Credit (HDTC), and (2) Dependent Care Tax Credit (DCTC). 

    • These credits are fully refundable and inclusive of immigrant families and families with the lowest incomes. However, families who claim the DCTC can receive up to 25% more than those claiming the HDTC, unfairly penalizing families who rely on informal care arrangements (such as stay-at-home parents).
    • These credits currently exclude families with older children and more than 2 dependents.

    2) In July 2022, the House and Senate unanimously voted to combine these credits, boost its value, and eliminate the large family penalty. However, despite unanimous support, these tax relief provisions were ultimately removed from the final economic development bill.


  • What Would this Legislation Do?

    1. Combine the Household Dependent Tax Credit (HDTC) and the Dependent Care Tax Credit (DCTC) into a single Child and Family Tax Credit (CFTC).
    2. Increase the value of the new CFTC to $600 per dependent.
    3. Remove the dependent age limits on the new CFTC.
    4. Remove the large family penalty from the new CFTC to support families with more than 2 children.  Under current law, families may choose between the Household Dependent Tax Credit and the Dependent Care Tax Credit for up to two children under the age of 13 or 12, respectively. Families who claim the DCTC receive 25% more than those who claim the HDTC. This bill would convert these credits to a single, streamlined Child and Family Tax Credit worth $600/dependent, inclusive of families of all sizes and children of all ages.

An Act to reduce poverty by expanding the EITC and the child and family tax credit 


Filed by Senator Eldridge (S.1798)


This bill would expand and streamline existing refundable state tax credits to provide all households with a basic income. 


  • Background

    ● The Earned Income Tax Credit (EITC) is a fully refundable tax credit for low- and moderate-income working people. The state EITC works as a complement to the federal EITC, currently matching 30% of the federal credit.

    ○ This evidence-based and targeted tax credit supports working families by bolstering income, but currently excludes working immigrant families and families with more than 3 children.

    ● MA currently has two dependent credits that families can choose between: the (1) Household Dependent Tax Credit (HDTC), and (2) Dependent Care Tax Credit (DCTC).

    ○ These credits are fully refundable and inclusive of immigrant families and families with the lowest incomes. However, families who claim the DCTC can receive up to 25% more than those claiming the HDTC, unfairly penalizing families who rely on informal care arrangements (such as stay-at-home parents). It also excludes families with older children and more than 2 dependents.


  • What Does This Legislation Do?

    1. Increase the EITC state match from 30% to 50% of the federal credit.

    2. Expand the EITC to immigrants who file taxes using an Individual Tax Identification Number (ITIN).

    3. Combine the Household Dependent Tax Credit (HDTC) and the Dependent Care Tax Credit (DCTC) into a single Child and Family Tax Credit (CFTC).

    4. Increase the value of the new CFTC to $600 per dependent.

    5. Remove the dependent age limits on the new CFTC.

    6. Expand the CFTC to include households without children.

    7. Remove the large family penalty from both the EITC and the new CFTC

    8. Improve access to the EITC and new CFTC through a robust communications and outreach campaign.

    9. Eliminate the $1,000 dependent exemption.



  • How Does This Impact MA Families?

    ● The EITC and new Child and Family Tax Credit (CFTC) would work together to deliver larger benefits that are inclusive of all families.

    ○ Eligible families would receive $600 per dependent through the CFTC and up to $3,715 through the EITC.

    ● The streamlined CFTC would reduce complexity and support all families equally, regardless of income or family size.

    ● Extending the CFTC to households without dependents would provide a basic income for all MA residents. Those with low incomes would also be eligible for up to $300 in EITC.

    ● Communicating eligibility for these refundable tax credits is essential. Currently, 20% of families eligible for the EITC do not claim the credit - a rate that is likely higher for dependent credits. A robust outreach campaign would promote awareness, and pull in federal EITC dollars that are being left on the table. 


An Act to increase family stabilization through the earned income tax credit


Filed by Representative Decker and Senator DiDomenico (H.2762/S.1793)


This bill would boost the value of the state EITC and extend eligibility to additional MA families.

  • Background

    ● The Earned Income Tax Credit (EITC) is a fully refundable tax credit for low- and moderate-income working people. The state EITC works as a complement to the federal EITC, currently matching 30% of the federal credit.

    ● The EITC lifts children out of poverty and lowers overall income inequality by 5 to 10 percent in a typical year, with greater impact for Black households who disproportionately earn low incomes.

    ● Children who live in households that receive the EITC have better school performance, greater college enrollment, and increased work and earnings in adulthood. These academic achievements are amplified with the size of the EITC.

    ● Expansions in the EITC have been associated with a decrease in infants born with low birth weights.

    ● Mothers receiving the EITC are more likely to have signs of good health, including lower risk of high blood pressure and inflammation and reduced reports of depression and stress.

    ● By boosting financial resources for families with low incomes, the EITC helps families afford basic needs including maintaining child care arrangements of their choice.


  • What Does This Legislation Do?

    1. Increase the EITC state match from 30% to 50% of the federal credit.

    2. Expand the credit to previously excluded groups of people, including:

    a. Immigrants who file taxes using an Individual Tax Identification Number (ITIN).

    b. Low-income college students not supported by a parent or caregiver.

    c. Younger (<25) and older (65+) adults without children.

    3. Eliminate the large family penalty by providing an additional 5% for each child beyond the current cap.

    4. Extend the state EITC to middle-income families by expanding the phase-out rate to those earning up to $75,000 annually.

    5. Improve access to the EITC and other refundable tax credits through a robust communications and outreach campaign.


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Tax Credit Fairness for Working Families