Testimony in support of An Act significantly alleviating poverty (H.5085/S.3095)

June 23, 2026

The Honorable Robyn Kennedy, Chair                                                     The Honorable Jay Livingstone, Chair
Joint Committee on Children, Families,                                                  Joint Committee on Children, Families, and 
and Persons with Disabilities                                                                        and Persons with Disabilities
State House, Room 312D                                                                                   State House, Room 146
Boston, MA 02133                                                                                                  Boston, MA 02133

RE: Testimony in support of An Act significantly alleviating poverty (H.5085/S.3095) 

Chair Kennedy, Chair Livingstone, and distinguished members of the Joint Committee on Children, Families, and Persons with Disabilities:

Thank you for the opportunity to submit written testimony in support of H.5085 and S.3095, An Act significantly alleviating poverty. The bill before you proposes comprehensive and interconnected investments and policy changes to greatly reduce poverty in Massachusetts. The bill offers a roadmap to tackle not just income inequities but wealth gaps that lead to persistent poverty among communities of color. 

The Massachusetts Budget and Policy Center (MassBudget) is a non-partisan, nonprofit research and advocacy organization. We provide rigorous research and targeted policy analysis, along with strategic advocacy in partnership with grassroots organizations and coalitions. We are particularly focused on developing research as well as analyzing and proposing public policies that help families at low and mid-income levels and communities of color achieve thriving lives.

The bill before you seeks to enact longer-term solutions to addressing systemic poverty in the Commonwealth. We want to highlight two types of policies included in the bill that address wealth gaps, which we see as vital to combatting poverty: progressive taxation and a wealth-building program known as “Baby Bonds”.

Progressive tax policy can be an effective tool for addressing both income and wealth gaps. A tax policy changes how much income a household keeps at the end of year, and marginal after-tax differences in income can accumulate over time and create major differences in wealth generation.  

The Earned Income Tax Credit (EITC) is an example of progressive tax policy that helps narrow income disparities and is one of the most effective anti-poverty tools the state has at its disposal. The EITC allows eligible families with lower incomes to access refundable credits to save at the end of the year, or spend in meaningful ways to become more economically secure. The EITC may enable a family to fix their car, pay a sizable medical bill, or cover afterschool care that in turn helps a parent keep their job. These are all benefits that can help a family avoid poverty and – in small, meaningful ways – put a family on a path toward building wealth.

The bill before you proposes policy changes to strengthen the state’s existing EITC. This includes expanding eligibility for the credit to workers who file with an Individual Tax Identification Number (ITIN), unpaid caregivers, younger workers, older adults, and individuals without dependents. Along with expanded access, the bill proposes improved outreach efforts and simplified tax filing assistance to ensure all eligible households receive access to this vital resource. 

In particular, we want to highlight the importance and equity implications of ensuring workers who file taxes using an ITIN instead of a Social Security Number (SSN) can access the state EITC. Currently, Massachusetts excludes up to 26,000 households who work and pay taxes from receiving the state EITC because at least one taxpaying person in the household does not have access to a Social Security Number (SSN). This is despite SSNs and ITINs both being valid identification numbers used by workers to file their taxes. 

The inability of a taxpayer to receive a tax credit because they are not eligible to file their federal taxes using a SSN adds another layer of inequity in our tax system. Those who use an ITIN to file their taxes are disproportionately Latino, Black, and Asian taxpayers. Because Black and Latino households typically have lower incomes and less wealth, they are the ones who would benefit the most from their hard work-earned tax credits. In addition, too many children who hold United States citizenship are excluded from receiving the EITC because they live in mixed-status families – in which one family member uses the ITIN to file their taxes.¹ In fact, about two thirds of households expected to benefit from extending the EITC to ITIN filers are of mixed status, between 14,200 and 17,300 households.² Ten other states and Washington, D.C. allow taxpayers who use an ITIN to file their taxes to claim their state EITC.³ There is no reason why Massachusetts continues to prevent workers and taxpayers from accessing an earned income tax credit.

The bill before you would also create publicly funded savings accounts, “Baby Bonds”, for children in households with low incomes. This policy tool would help children whose families lack the financial resources and opportunities to build generational wealth. The program would automatically enroll children under the age of one who receive cash assistance through Transitional Aid to Families with Dependent Children (TAFDC) or are in the care or custody of Massachusetts Department of Children and Families (DCF). Each account would receive an initial state investment that would accrue interest over time and become available for participants when they reach adulthood. “Baby Bonds” funds would be eligible for spending on wealth-generating advantages such as postsecondary tuition, buying a home, or starting a business. 

A “Baby Bonds” program was originally recommended by a task force, formed in March 2022 by Massachusetts Treasurer and Receiver General Deborah Goldberg.⁴ The task force proposed that children would be automatically enrolled into “Baby Bonds” based on their TAFDC eligibility or participation in the foster care system. The task force urged the identification of a long-term funding source and recommended a review of criteria to determine whether enrollment could be expanded after five years. 

“Baby Bonds” are not some impossible dream. In July 2023, Connecticut launched a “Baby Bonds” program that automatically enrolls children covered by the state’s Medicaid program (HUSKY). The program has already been fully funded for the first 12 years of children. Eligible newborns receive a deposit of up to $3,200 that can be claimed between ages 18-30 and used for starting or investing in a business, attending higher education or job training, buying a home, or saving for retirement.⁵ Participants are expected to receive $11,000 – $24,000 depending on when the funds are retrieved. The state estimates that 15,000 to 16,000 Connecticut children who are covered by HUSKY will enter the program each year.⁶

Massachusetts needs to enact heightened anti-poverty efforts on many fronts. The state has an opportunity to be a leader in how we take care of our residents during times of crisis and take steps beyond that to ensure we help people truly thrive. This should include boosting the state EITC and broadening its eligibility to excluded groups such as workers filing taxes with an identification number other than the Social Security Number and creating a “Baby Bonds” program. 

We urge the Committee to report this bill favorably. Now is the time for Massachusetts to be ambitious about addressing the long-term causes of poverty by thinking not only about the immediate definition of inadequate income but also about ways to address more fundamental disparities of wealth. These may be harder to fix, require greater resources to bring to scale, and may take time to pay off. But without addressing disparities of wealth, we will leave untouched some of the most profound and persistent barriers to opportunity.

 Thank you for your time and consideration. 

Respectfully submitted, 

Viviana M. Abreu-Hernández, Ph.D., President
Massachusetts Budget and Policy Center