The Earned Income Tax Credit and Female-Headed Households: Usage & Family Impacts
Master's Thesis by Suzanne McGarvey, 1999
Dr. Craig L. Israelsen, Thesis Supervisor
Abstract:
The objectives of this research were to understand how Earned Income Tax Credit (EITC) recipients spend their EITC money, understand what recipients feel the EITC has done for them, and understand if, and on what, recipients are planning to use future EITC benefits.
- Milton Friedman's Permanent Income Hypothesis was used as a
framework for the study. This theory, as well as literature
regarding the financial management practices of low-income families,
guided the research questions as well as the analysis. Interviews
lasting between thirty and forty minutes were conducted with seven
women in rural Missouri towns. The women were either currently
single mothers or recently had been. The interviews were taped with
the permission of the interviewees, and after being transcribed,
were coded in order to find common themes and compare answers given
by the women across all seven interviews. Information was collected
about the women's experience with the EITC and related issues.
The study showed that most of the women interviewed:
- preferred to receive their EITC payment in a lump sum rather than through advanced payments,
- used their EITC payment for bills, housing and transportation needs, and other necessities,
- paid bills that were the most overdue or most important to them before anything else,
- expected to receive the EITC in the future and already had plans for the money,
- viewed the definition of "welfare" differently and felt the EITC was not the same as welfare, and
- faced many difficulties because of their financial situation.
To download the full study, please see the following:
Thesis (Word Document)
List of Tables (Word Document)
