OCS Paper 1

Q. Which of the following policies provide a Tax refund on all or part of a poor family’s Social Security Tax?

(A) Temporary Assistance to needy families
(B) Earned Income Tax Credit
(C) Food Stamps
(D) Supplemental Security Income

Question from Odisha OCS Paper 1 2024

The correct answer is: (B) Earned Income Tax Credit

Explanation:

Earned Income Tax Credit (EITC)

The Earned Income Tax Credit (EITC) is a tax benefit designed to help low- to moderate-income working individuals and families. It provides a refundable tax credit, meaning if the credit exceeds the amount of taxes owed, the taxpayer receives the difference as a refund. This policy reduces the tax burden on poor families and can result in a refund of all or part of their Social Security taxes.

Option (A), Temporary Assistance to Needy Families (TANF), is a welfare program that provides cash assistance to low-income families but does not involve tax refunds.
Option (C), Food Stamps (now called SNAP), provides food assistance but is unrelated to tax refunds.
Option (D), Supplemental Security Income (SSI), provides financial assistance to disabled or elderly individuals with low income but is not related to Social Security tax refunds.

Therefore, the correct answer is (B) Earned Income Tax Credit.

Check Demo Video

UPSC Factory

Master UPSC offline! 📚🎯 4000+ Prelims PYQs, Mains model answers, NCERT books, Syllabus tracker, topper notes, past papers.
Give it a try, you will love it !!💯

UPSC Factory for Android
Conquer UPSC offline! 🚀 PYQs (Prelims & Mains), Test Series, Syllabus Tracker.
Give it a try, you will love it 💯