Tax Credits for Abortion

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Could the federal government offer tax credits for abortion?  That’s what one commenter asks over here at Metafilter, about the implications of the  decision of the United States Supreme Court in Arizona Christian School Tuition Organization v. Winn (copy of that decision is here).

The Supreme Court ruled that tax payers have no standing to sue over tax credits given to those who donate to religious schools.

Justice Anthony Kennedy, writing for the five-justice majority, said that taxpayers may challenge a direct legislative appropriation for religious schools, but not a tax credit. He conceded that a tax credit and a direct government expenditure “may have similar economic consequences,” but he said a tax credit is different because any injury to the disagreeing taxpayer is “speculative,” and the money is directed by private individuals, not the state.

Reading between the lines, Kennedy and the majority agreed that money isn’t fungible. The money given in the tax credit is different from the money donated to the religious organization.

By this logic, a tax credit to those women who get an abortion (or perhaps, a dollar-for-dollar tax credit to those who donate to organizations associated with Fund Abortion Now) would not be a violation of the Hyde amendment. After all, it’s not federal dollars being spent on abortions, it’s my own money. Any consequences are purely speculative.

Recall that the Hyde Amendment prohibited Medicaid funding of abortions.  If government spending is, in fact, constitutionally different from tax credits, then would the credit pass muster under the Hyde Amendment?

If a credit would be permitted, it might be politically difficult to implement, especially if the credit were refundable.  Although there’s lots of good scholarship — by Francine Lipman (here, e.g.) and Dennis Ventry, Jr. (here, e.g.), among others — that suggests the EITC is an efficient means of delivering a financial benefit to the working poor, the program’s critics are quick to point to highly sensationalized cases of fraud and abuse.  For many taxpayers, taking the EITC is the equivalent of asking the IRS for an audit.

Consider also that a non-refundable (i.e., “use it or lose it”) credit is beneficial only to those who file tax returns.  For a married couple filing jointly where both spouses are younger than 65, the income tax return filing threshold is $18,700.  A married couple with, say, three children will be eligible for Medicaid in New York States, for example, where the household income is below roughly $36,000 per year.  So, many Medicaid recipients file tax return, but the poorest of the poor do not.

H/T Sarah Tx and Ribesfuchia.

-Bridget Crawford

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