'Secondary Evasion' and the Earned Income Tax Credit

Posted: 24 Apr 2006

See all articles by Andrew Schmidt

Andrew Schmidt

North Carolina State University

Edward M. Werner

Rutgers, The State University of New Jersey

Multiple version iconThere are 2 versions of this paper

Abstract

This paper documents that the earned income of taxpayers claiming the earned income tax credit (EITC) tends to cluster within $800 intervals surrounding the kink points of the EITC benefit distribution. This clustering is especially strong for head of household taxpayers around the kink point of the phase-in range and, to a lesser extent, for married filing joint taxpayers around the kink point of the phase-out range. The results from logit regression models estimated by filing status and kink point location indicate that secondary evasion' with respect to the EITC is more associated with the characteristics of head of household taxpayers than those of married filing joint taxpayers.

Keywords: Earned Income Tax Credit, Tax Compliance, Kink Points

JEL Classification: H24, H26, M43

Suggested Citation

Schmidt, Andrew P. and Werner, Edward M., 'Secondary Evasion' and the Earned Income Tax Credit. Journal of the American Taxation Association, Vol. 27, No. 2, Fall 2005, Available at SSRN: https://ssrn.com/abstract=897550 or http://dx.doi.org/10.2139/ssrn.470381

Andrew P. Schmidt (Contact Author)

North Carolina State University ( email )

Raleigh, NC 27695-8113
United States

HOME PAGE: http://https://poole.ncsu.edu/people/apschmid/

Edward M. Werner

Rutgers, The State University of New Jersey ( email )

Camden, NJ 08102
United States
(856) 225-6978 (Phone)

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