Free Tax Preparation Assistance is Available for Low-Income Families
DC’s Earned Income Tax Campaign helps low-income families prepare and file their taxes for free. That’s right, free. Families that earned less than $42,000 and individuals that earned less than $22,000 last year can go to any of the Campaign’s five tax prep sites to get their taxes done and filed for free by IRS-certified preparers. Last year, the campaign helped low-income families file 6,000 returns and receive $9 million in credits and refunds.
Tax time can be very critical for many low-income working families. That’s because many earn so little —despite working full-time, year-round—that they are eligible for tax credits. Tax credits can provide a significant boost to a family’s income by lowering the taxes they have to pay or by providing a refund. The Earned Income Tax Credit (EITC) is one of the most important tax benefits for low-income working families. The EITC is available as a federal tax credit and also as a state tax credit in DC and 24 states. DC’s EITC, which is 40 percent of the federal EITC, is the highest state-level EITCs in the nation.
Because the tax returns families are filing now are based on last year’s income, the EITC can provide tax refunds to unemployed families that worked at some point last year but lost their jobs. In that way, filing a tax return may help families weather the recession.
And while the campaign helped so many low-income families file their taxes last year, there are still many families who are eligible for the credit and who are not claiming it. In fact, DCFPI estimated that between 7,000 and 11,000 people were eligible for the federal EITC—which must be claimed in order to claim DC’s EITC—but did not claim it. This means that outreach to low-income communities is crucial. So please, pass the word about the free tax preparation services for DC’s low-income families. More information about DC’s Earned Income Tax Credit Campaign, and how you can be involved, can be found here.