During last year’s tax filing season, more than 27 million American families were refunded in excess of $62 billion by taking advantage of the Earned Income Tax Credit, or the Earned Income Credit (EITC or EIC).
However, each year, millions of families fail to take advantage of billions of dollars in EITC refunds that they are eligible to receive, and the funds go unclaimed. The Government Accountability Office (GAO) and Internal Revenue Service indicate that between 15 and 25 percent of households who are entitled to the EITC do not claim their credit— between 3.5 million and 7 million households.
Is your family losing out on potential tax refund dollars?
If your family is considered low-income or medium-income by the Internal Revenue Service (IRS), that may be the case. The refundable tax credit applies primarily to individuals and couples who meet the income requirement and have qualifying children.
In order for a qualified tax filer to claim one or more persons as their qualifying children, the age, relationship, and shared residency requirements must be met, as well as some other requirements. This tax credit is intended to offset the burden of social security taxes and to maintain an incentive to work.
To help connect qualified tax filers with information about EITC, Goodwill Industries International has joined with The Walmart Foundation, National Disability Institute and United Way Worldwide to launch the MyFreeTaxes Partnership.
These national and local partners offer free federal and state tax preparation and filing services, both online and in person, to eligible Americans. Taxpayers using this service will receive eligibility information about EITC, and other tax credits that help them keep more of what they earn.
To learn more about how the EITC may be able to help you keep more of your hard earned dollars in your pocket, visit My Free Taxes. http://www.myfreetaxes.com.
Enacted in 1975, the EIC has been expanded by tax legislation on a number of occasions, including the Reagan Tax Reform Act of 1986, and in 1990, 1993 and 2001. The EITC is the largest poverty reduction program in the United States. EITC dollars have a significant impact on the lives and communities of the nation’s lowest paid working people. The U.S. Census Bureau found that the EITC lifted 5.4 million people above the poverty line in 2010.