An increasing number of struggling, low-income Connecticut families are required to pay state income taxes, because the state has failed to increase the “tax threshold,” which is the income level at which families begin paying taxes, a report by two policy groups found.
The policy groups, Connecticut Voices for Children and the Center on Budget and Policy Priorities, found that of the 42 states, including the District of Columbia, that have a state income tax, Connecticut is the only state that has not adjusted its tax threshold upward since 1991. As a result, more low-income families have been paying income taxes, the report concludes.
For example, a family of four in Connecticut earning just $24,100 owed the state income tax in 2007 (if they were not eligible for the property tax credit because they owned neither a car nor a home). If the tax threshold had remained at the same level above the federal poverty line, today it would be $38,713.
Click here to read the entire report online.