• Mr. Steven J. Muehler

Steve Muehler's Plan to Reduce Anti-Marriage Penalties in the Earned Income Tax Credit

Updated: Apr 23


The purpose of the Earned Income Tax Credit ("EITC") is to provide a refundable tax credit to low-income parents with children. To receive the credit, a person should have to be the actual custodial parent of the child. Non-custodial parents should not be eligible for the EITC. In the event of cohabiting, non-married parents should receive the credit based only on the mother’s income.


Erroneous over-claims equal between 29 percent and 38 percent of the dollar value of EITC claims.

Roughly 20 percent of all EITC claims involve a qualifying-child error—cases in which the parent or the child or both are not eligible to receive the credit. About three-quarters of over-claims with qualifying-child errors involve false claims of residency. Many qualifying-child errors involve payments to relatives and non-custodial parents of the child, many of whom do not reside with the child. Restricting EITC eligibility and tightening residency documentation would reduce qualifying child errors and other unjustified payments.


Current qualifying child claim errors may cost taxpayers as much as $10 BILLION USD per year. Under my Administration, we estimate savings could equal roughly 35 percent of the cost of qualifying child errors, or $3.5 BILLION USD per year.


Steve Muehler is the Founder & Managing Member of the Private Placement Markets:

About Mr. Steve Muehler, Founder & Senior Managing Member:

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