Increasing take-up of the EITC

In 2018 and 2019, as part of a collaboration with the California Policy Lab, we worked with the California Franchise Tax Board, the CalEITC4Me campaign, and CalFresh to test whether a series of informational nudges could increase the take-up of the state and federal Earned Income Tax Credit (EITC) in California. To claim the credit, low income Californians must file their taxes– but many qualified families fall below the threshold that require them to file. The nudges, in the form of letters and text messages to over 1 million Californians, tested a series of questions on whether government and non-profit partners were reaching the right people, employing the right messengers, targeting the right barriers to take up, and using the right mode and formality. We found that these informational nudges were not enough to improve filing and claiming rates, raising the possibility that the barriers faced by low income families involve navigating the complex administrative burdens involved with filing taxes. Future research will focus on testing how simplifying the process of filing taxes for low income families can improve take up. 


Policy Report:
Increasing take-up of the Earned Income Tax Credit 
Publication:
Increasing take-up of the Earned Income Tax Credit  
Media Coverage:
CNN: Millions of low-income Americans are at risk of missing out on stimulus payments April 8, 2020.
NPR’s Planet Money: The Limits Of Nudging: Why Can’t California Get People To Take Free Money? February 4, 2020.
Fresno Bee: California has a tax credit that many are missing out on. Here’s what you can do to collect it January 23, 2020.
Market Watch: ‘Taxpayers are leaving millions of dollars off their returns.’ Why Americans repeatedly overlook this lucrative tax credit February 1, 2020

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