EITC proves.
Lawrence M. Mead 2014; professor of politics and public policy at New York University and an adjunct scholar at the American Enterprise Institute; Overselling the Earned Income Tax Credit; No Publication; https://www.nationalaffairs.com/publications/detail/overselling-the-earned-income-tax-credit; DL
The EITC was popular with policymakers because it appeared to raise work levels through incentives and without TANF's punitive measures. The credit was reformed and somewhat expanded in 2001 (with changes intended to help mitigate its "marriage penalty") and was then expanded further for families with three or more children as part of the 2009 stimulus package.
The subsidy that the EITC now provides is therefore quite substantial. In 2013, workers with children and with family incomes up to $51,567 could receive a credit amounting to as much as 45% of their earnings, up to $6,044, depending on income and the number of children in the family. Under EITC's structure, as earnings rise, the subsidy builds to its maximum value, stays flat for an interval if earnings rise further, and then at still higher earnings is phased out until it disappears. Single workers without dependents receive a much smaller benefit. The credit is refundable, meaning that if workers have insufficient tax obligations to exhaust the credit, they receive the difference in cash. For many low-income workers, "tax day" in April is now a time when they receive income from Uncle Sam rather than having to pay him more.