Earned Income Tax Credit^
Income Tax Rate: 5 percent
State EITC: No
Notes/News: During the 2009 legislative session, HB 133 was introduced in the Utah State Legislature to create a state EITC set at 10 percent of the federal credit. The bill passed out of the House Revenue and Taxation Committee, but failed to pass the full House.
The Utah Tax Review Commission (a group of tax experts and practitioners named by the governor and legislature that has only advisory functions) recommended reinstating the full state sales tax on food (raising it from 1.75 percent to 4.75 percent) and implementing a 6 percent state EITC.
In August 2011, Utah State Senator Pat Jones (D-Holladay) proposed ending the state’s income tax exemptions for dependents in order to generate about $400 million, $48 million of which would go toward creating a state EITC.
On March 1, 2012 the Utah Senate advanced a bill that would have established a state Earned Income Tax Credit at 5 percent of the federal credit. The bill, SB 211, passed its second reading by one vote. To pass, the bill would have had to pass a third reading and then go to the House. According to the fiscal note, the bill would have benefited 200,000 people with an average benefit of $105. Unfortunately, with time running out, the sponsor chose not to pursue the bill further in 2012.
In February, 2013, Representative Hutchings introduced a bill, HB197, that would have created a state EITC at 5 percent of the federal credit. On March 4, the House Revenue & Taxation Committee passed the bill and on March 10 the full House passed the bill. Unfortunately, the Senate did not reach the bill before the close of session.
In February, 2014, Representative Hutchings introduced HB218 which would have created a state EITC at 5 percent of the federal credit. The bill passed out of the House Revenue and Taxation Committee on February 20 and was passed by the full House on February 28. While it was recommended out by the Senate Revenue and Taxation Committee on March 5, unfortunately the legislative session ended before the full Senate could vote on the bill for final passage.
Reports/Materials: My view: Bolstering the Earned Income Tax Credit, Rep. Eric Hutchings, The Deseret News, February 2014
Tax credit helps Utah military and veteran families, analysis shows, The Salt Lake Tribune, July 2013
Families in House District 5 Benefit from HB 197, Voices for Utah Children, February 2013
“Utah State & Local Taxes,” from Who Pays? A Distributional Analysis of the Tax Systems in All 50 States, Institute on Taxation and Economic Policy, January 2013
Analysis of a Three-Part Proposal to Reform Utah’s Sales Tax, Allison Rowland, Voices for Utah’s Children, January 2013
State Refundable EITC: A Valuable Investment for Utah, Tracy Gruber, Voices for Utah Children, October 2012
How a State EITC Would Help Senate District 14, Voices for Utah Children, 2012
Invest in Working Utahns: Support a State EITC, Allison Rowland and Tracy Gruber, Voices for Utah Children, August 2012
What a $100 EITC credit could do for a family of four. . ., Voices for Utah Children, 2012
Better Research, Better Rules Alleviate Concerns with EITC Error Rates, Voices for Utah Children, 2012
Invest in Working Utahns: Vote YES on SB211, Voices for Utah Children, 2012
Utah: State and Local Taxes in 2007, Institute on Taxation and Economic Policy, November 2009
Issue Overview: State Earned Income Tax Credit (EITC), Center for Poverty Research and Action, Utah Issues
Child Tax Credit^
State Credit: No
Child and Dependent Care Tax Credit^
State Credit: No
Property Tax Circuit Breaker^
Circuit Breaker: No
Notes/News: Utah does offer tax credits to low income, senior and disabled homeowners and renters. The credits are not calculated as a percentage of the filer’s income. For more information about these credits, please see the Utah State Tax Commission’s Property Tax Division.