Abstract
The gap between high- and low-income Americans has widened dramatically over the past 40 years, and men without high school degrees saw their real earnings fall by 18 percent between 1977 and 2017. Real earnings for women with similar levels of education also have been stagnant over the same period. One proposal to address this erosion of income for low-wage workers has been to expand the federal Earned Income Tax Credit (EITC), which supplements the earnings of families by as much as $6,000 a year. But the federal EITC for single tax filers, which is capped at a maximum annual payment of only $487, is much less generous and as a result less effective at increasing employment and reducing poverty. The Paycheck Plus demonstration is testing the effects of a more generous EITC-like earnings supplement for low-income single adults in New York City and Atlanta, Georgia, in which the credit for workers without children is increased to $2,000 and extended to provide benefits to workers earning up to $30,000 per year, with the maximum payment being made to those with earnings between $6,667 and $18,000. A separate entry in the registry documents the test in NYC. This entry documents the test in Atlanta, which includes about 4,000 participants, with 2,000 eligible to receive the expanded credit and 2,000 forming a control group.