By Jessica Hathaway
Do you have constituents in your legislative district that earn between $14,880 and $53,505 per year? If so, they might be missing out on claiming the federal earned income tax credit, known as the EITC.
The EITC—a refundable tax credit—is available to folks who have an income, meet certain income limits set by the Internal Revenue Service (IRS) and file a tax return.
Single filers receive less than families and the largest EITC refunds can range from $506 to $6,269. For many working families and individuals, their tax refund is the largest lump sum of income they receive all year. The average EITC amount received last year was about $2,455.
So, why do approximately 20 percent of eligible tax filers not claim the EITC that they’re eligible for? It’s likely that they simply don’t know about it.
One way to ensure that your constituents get their full refund is to let them know about the EITC and free tax prep services.
Here are some ways to get the word out:
- Talk about it. Let your constituents know they must file a tax return to claim the EITC even if they aren’t required to file because of low earnings or not owing taxes. Highlight this information in newsletters, email, websites, social media and at town meetings. Check out the IRS EITC partner toolkit for marketing examples and more ideas.
- Find a free tax preparation site. There are thousands of Volunteer Income Tax (VITA) sites in the U.S. These sites are staffed by trained IRS volunteers and provide free tax preparation for those eligible for the EITC. The Tax Counseling for the Elderly (TCE) program also offers free tax preparation services geared toward people age 60 and over.
- Spread the word about other free file options. The Free File Alliance, in partnership with the IRS, is a coalition of 13 industry-leading tax software companies that offer free online tax prep software to people with an adjusted gross income of $62,000 or less. Federal taxes can be filed for free and 20 states and the District of Columbia offer their own free file programs, too.
- Call the press. Invite constituents and reporters to join you in a visit to a free tax prep site.
- Contact employers. Ask major employers in your district to let their employees know about the EITC.
Twenty-six states and the District of Columbia have their own EITC in addition to the federal credit. Learn more about the EITC and other issues relevant to America’s working families by visiting NCSL’s Family Opportunity Project webpage.
Jessica Hathaway is a policy associate with NCSL's Family Opportunity Project.