Tax Credit for Low Income Workers
August 3, 2009
Valuable Tax Credit Available For Some Low to Moderate Income Workers
People who work but don’t earn a lot of money may be eligible for the Earned Income Tax Credit, as well as free help preparing their tax return. January 30, 2009 marked EITC Awareness Day, a nationwide effort to increase public awareness about EITC and free tax preparation sites.
IRS estimates that 20 to 25 percent of eligible taxpayers fail to claim the credit which could put as much as $4,824 into the pockets of a family with two children, or send as much as $2,917 to a family with one child, or up to $438 for a worker with no children. The Earned Income Tax Credit is the federal government’s largest program benefiting lower earning workers.
Some individuals and families may qualify for the credit for the first time because of unemployment or other changes in their financial, marital or parental status during the past year.
Taxpayers with the earnings of or below $38,646 ($41,646 if married filing jointly); for families with two or more children $33,995 ($36,995 married filing jointly); for families with one child or $12,880 ($15,880 married filing jointly); if there are no children, check the IRS website, Tax Assistance Site or with a local IRS Taxpayer Assistance Center.
The EITC is a valuable but complex tax break. Free help is available to determine eligibility and file to claim the credit at Volunteer Tax assistance Sites or, for those who cannot visit a site during hours/days of operation, at a local IRS Taxpayer Assistance Center. Qualified volunteers offer free tax filing help to low-income Mainers.
REGIONAL TAX HELP COALITIONS
Offer both free tax assistance and help with building assets from credits claimed:
Greater Portland CA$H Coalition
Midcoast Maine CA$H Coalition
Call: 373-1140 ext. 275
York County CA$H Campaign
Call: 324-5762 ext. 2718 or 1-800-965-5762 ext. 2718
Maine IRS Taxpayer Assistance Centers:
Located in Augusta, Bangor, Lewiston, Presque Isle, and South Portland.
VITA and AARP Tax-Aide Services have better error rates (make fewer mistakes) than many commercial tax preparers. Many sites offer free e-filing, some offer home visits, if needed, and a some - especially in Portland and Southern Maine - offer help in languages other than English:
To find the site nearest you, use AARP's online search tool or call 1-888-687-2277
VITA (Volunteer Income Tax Assistance) IRS-Sponsored Program Get 2008 list of all Maine VITA and AARP Tax-Aide sites, sorted by county. (.pdf file) (We will post the 2009 list as soon as we get it; in the meantime, many of the help sites will be the same at last year.) Or call 1-800-829-1040
If your total household income is less than $50,000 and you don't itemize your deductions, try free I-CAN!™ online filing. Or visit the IRS site for links to other free online filing options. Each provider sets its own eligibility rules for its free filing program, so it's worth exploring several sites to see if you qualify
Non-resident Aliens: Check out the Guide for Nonresident Aliens Preparing Federal Income Tax Returns posted by the International Office of the University of Texas at Austin:
More IRS Resources
IRS page for individuals, designed "to make the agency’s Web site an even easier-to-use source of information."
Free Tax Help Available
This IRS press release outlines free tax help programs offered by the IRS and others.
Choosing a Tax Return Preparer
IRS Tips for finding a reputable tax preparer, and avoiding the bad ones.
For sources to this weeks tip, as well as additional information, visit: