EITC could work for you

 1/29/2016

Wondering about the EITC? Here’s a primer:

1. What is the Earned Income Tax Credit (EITC)?

In 1975, Congress enacted the EITC to provide financial assistance for working families and individuals with low incomes. For the 2015 tax year, the EITC allows eligible workers, single or married, with or without children, to receive a tax refund of up to $6,242. You could use that money to fix up the home, or tune-up the car, or start saving for retirement or higher education, for example.
The EITC’s worth depends on family size and filing status, so it is essential that workers find out whether they qualify. And you have to file a federal tax return to claim the credit.

2. What are the income limits for EITC?

According to the IRS, a filer’s earned income and adjusted gross income (AGI) must each be less than the following for tax year 2015:

• $47,747 ($53,267 married filing jointly) with three or more qualifying children
• $44,454 ($49,974 married filing jointly) with two qualifying children
• $39,131 ($44,651 married filing jointly) with one qualifying child
• $14,820 ($20,330 married filing jointly) with no qualifying children

3. How much money can some families expect to receive by claiming the EITC?

According to the IRS, filers can receive the following for tax year 2015:

• $6,242 with three or more qualifying children
• $5,548 with two qualifying children
• $3,359 with one qualifying child
• $503 with no qualifying children

4. How many individuals fail to claim the EITC?

Only four out of five eligible Americans claim the EITC, according to the Internal Revenue Service, meaning 20 percent of those who qualify don’t claim it. However, families may back file as far as three years to claim the credit if they have not done so in the past.

5. How do I get started?

See this IRS fact sheet for more information. 

There are also free tax preparation services available to help.

MyFreeTaxes.com is an online resource that provides free federal and state tax preparation, and filing assistance online to individuals and families that qualify for EITC. 

Volunteer Income Tax Assistance (VITA) sites offer free tax preparation services for eligible individuals and families in the community. In Tulsa, Goodwill participates in the United Way’s VITA program, which hosts volunteer tax preparers at sites across the area. Daytime sites open at 9 a.m. and the evening site opens at 5 p.m. The sites open next week:

• Monday: Tulsa Dream Center
• Tuesday: East Side Christian Church
• Wednesday: TCC
• Thursday (evening): The Center for Individuals with Physical Challenges
• Saturday: Goodwill Tulsa

During the 2014 tax-filing season, 65 Goodwill members hosted VITA sites or utilized MyFreeTaxes to help more than 40,000 people file tax returns for free or low cost. Goodwill is helping to put hard-earned money back into the pockets of families who need it most.

More

1. Be cautious when reviewing your tax preparation needs. Steer clear of predatory lending practices that can drain money from your hard-earned tax refunds. With so many free resources available, such as the IRS e-file system and Goodwill VITA sites, consumers should review their options before opting for a short-term fix.
2. To see if you qualify for EITC, visit the IRS website at www.irs.gov/eitc.
3. For VITA location times, call 2-1-1.
4. Visit goodwilltulsa.org/freetaxprep for more tax tips and information.