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February 26, 2014
Thousands of working families in Colorado overlook important federal tax credits because they simply don't know they exist. They could miss out on $5,000 or more in federal income tax refunds through the Earned Income Tax Credit (EITC) and other tax benefits.
Workers earning less than about $50,000 from wages, self-employment, or farming could qualify for the EITC, a refundable tax credit available to lower-income workers and their families. Many people will qualify for the first time this year due to changes in their income, their marital status, or parental status, according to the IRS.
The Piton Foundation estimates that 50,000 Coloradans miss out on as much as $85 million in EITC refunds each year. The impact of missing out on the refunds is very real, and I would like to share one particular example with you.
A woman by the name of Sarah contacted United Way 2-1-1 for help with rent assistance. She had a three-day notice of eviction and was desperate.She was in a rent-to-own situation with her trailer and had only one more payment before her home was paid for.Sarah had not been able to work for the past several months due to two debilitating disabilities and was in the process of applying for Social Security Disability. She had depleted her savings and was now $350 short in making her payment.
Sometimes in the midst of a problem, it is difficult to see the solutions. Through the course of their conversation, the 2-1-1 Community Specialist determined that Sarah had not yet filed her 2013 taxes.She was informed of the Volunteer Income Tax Assistance (VITA) sites near her, and she learned how the program offers free tax preparation and filing for low-income residents.Ultimately, Sarah's landlord was willing to work with her until she received her tax return and her home was saved.
Tax credits, like the EITC, help working families in Colorado and also help stimulate our economy. Tax credits are primarily used to pay for necessities, such as utilities, food, housing, transportation, education, and health care. According to Piton, programs like the EITC are associated with a boost in children's school readiness and achievement, health outcomes, and future economic success. The local economy is also stimulated as economists estimate that tax credit dollars are re-spent threeto five times in the local business community.
The local VITA program offers free tax preparation services to lower-income families at five sites in Northern Colorado. IRS-certified tax preparers will help thousands of families determine their tax credit eligibility and claim these much-needed and often-missed refunds.
The free tax sites here in Larimer County are open from February 3rd to April 15th at Spirit of Joy Lutheran Church, Old Town Library, and Council Tree Library in Fort Collins; First United Methodist Church in Loveland; and Clearview Library in Windsor. Those interested in having their taxes prepared should bring income documents from all jobs worked throughout the calendar year, as well as their social security number and a valid photo ID.
For complete information, call 2-1-1 or 970-407-7066, or visit www.makechangenoco.com/free-tax-prep.
Let's make sure that our employees, friends, family members, and neighbors don't miss out on this valuable resource. It will not only benefit working families, but will also boost our economy.
Copyright 2015 United Way of Larimer County