Researcher ORCID Identifier

https://orcid.org/0009-0002-3430-4865

Graduation Year

2023

Date of Submission

4-2023

Document Type

Open Access Senior Thesis

Award

Best Senior Thesis in Public Policy

Degree Name

Bachelor of Arts

Reader 1

Eric Helland

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Terms of Use for work posted in Scholarship@Claremont.

Rights Information

© 2023 Anika Kimme

Abstract

Using Survey of Income and Program Participant (SIPP) Census Data, this paper employs a regression discontinuity and panel data analysis to determine the impact of the tax filing cutoff on an individual’s decision to file and whether a person’s decision to file is impacted by the value of the tax credit available to them. The Biden administration’s expansion of the Child Tax Credit (CTC) changed the CTC from a tax deduction to a cash transfer program as the credit became available to everyone, even if they did not pay taxes. Importantly, to receive the tax credit from the Internal Revenue Service (IRS), individuals and families had to have filed their taxes or needed to fill out a simplified tax form to claim the CTC. The IRS is not a welfare distribution service and this paper studies whether it can effectively distribute programs such as the CTC and reach those who would benefit from the tax credit most. The paper shows mixed findings, suggesting that people with children under 18 file at higher rates and are more likely to receive tax credits. However, there is also a large correlation between filing and education, with people who have more education being more likely to file. The regression results suggest support for the effective distribution of welfare through the IRS but also a need for more tax filing help and outreach to less educated communities.

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