DURHAM, N.C. – With the nation looking for ways to help people survive the current economic crisis, State Treasurer Janet Cowell, Congressman David Price, and other state and local leaders want to ensure that eligible North Carolina workers claim the Earned Income Tax Credit (EITC) when they file their taxes this year. As an additional incentive, this year workers can also claim the new North Carolina EITC passed by the General Assembly in 2007 and worth 3.5 percent of the federal credit. For families with two or more children, the two credits combined can be worth close to $5,000.
According to EITC Carolinas, qualified workers leave an estimated $135 million or more in federal EITC dollars unclaimed every year in North Carolina, costing the state at minimum an additional $200 million in statewide economic stimulus. And what many workers may not realize is that, even if they were laid off or lost their jobs in 2008 as the state’s unemployment rate rose to 8.7 percent, they are still eligible to receive the credit as long as they had earned income during the year.
“This North Carolina EITC tax credit, the first the state has offered, comes at a time when working families are uncertain about their economic future,” said Treasurer Cowell. “Claiming both tax credits they’ve earned through this statewide outreach campaign delivers on the promise that we are here to serve the needs of working families while improving the state’s economy.”
To mark national EITC Awareness Day and the deadline for workers to receive W2 forms for the start of tax season, state and local leaders will join the EITC Outreach Working Group in holding a press conference on Friday, Jan. 30, from 11 a.m. to noon at the Durham Public Schools Staff Development Center at 2107 Hillandale Road to talk about the EITC—the nation’s largest anti-poverty program—and the new North Carolina EITC that goes into effect this year. The EITC Outreach Group, convened with the leadership of the General Assembly, consists of a broad spectrum of state agencies, employer groups, and community organizations (list of participating groups attached).
The Durham Public Schools Staff Development Center will host a new Volunteer Income Tax Assistance (VITA) site this year as part of a broader Durham County EITC outreach effort. Tax filers earning $50,000 or less are eligible for free income tax preparation services provided by IRS-certified preparers at the site.
Speaking at the event will be State Treasurer Janet Cowell, Congressman David Price, State Representative Paul Luebke, Durham County Commissioner Ellen Reckow, Durham Mayor Bill Bell, and Durham Superintendent of Public Schools Carl Harris. Others in attendance will include representatives from the EITC Outreach Working Group, the N.C. Department of Revenue, the Durham Chamber of Commerce, and the Durham and Wake County EITC Coalitions. Tax preparers and clients also will be present and available for interviews. The event is sponsored by the EITC Outreach Working Group, the Community Reinvestment Association of North Carolina, the EITC Carolinas Initiative of MDC, Inc., in Chapel Hill, and Durham Public Schools.
The federal EITC is the nation’s most effective anti-poverty measure aimed at low- and moderate-income working families. Each year, it lifts 5 million Americans out of poverty—more than half of whom are children. In tax year 2005, more than 20 percent of North Carolina taxpayers and their families benefited from the federal EITC, receiving a total of $1.5 billion.
Families earning up to $41,646 in 2008 will qualify for the EITC, depending on their number of children and their filing status. Single workers and those without children are also eligible. Workers who don’t owe taxes or who aren’t required to file a tax return are also eligible but they must file a federal return to receive the federal credit and a state return for the NC EITC. The eligibility requirements for both the federal and NC EITC are the same.
In addition to tax filers who fail to claim the tax credit, even more money is lost to working people when they use paid preparers and purchase costly rapid anticipation loans—which carry high interest rates in return for getting tax refunds and credits perhaps a week early.
EITC Carolinas helps support a statewide network of free tax preparation sites staffed by participants in the IRS’ VITA (Volunteer Income Tax Assistance) program. Often, customers come in who are unaware they are eligible for the EITC and leave with the surprise satisfaction of learning that they will receive thousands of dollars back from the IRS that they weren’t expecting. The money often pushes them above the poverty level, allowing them to pay bills , boost savings, or make essential purchases.
For more information about the federal or N.C. EITC, EITC Carolinas and the EITC Outreach Working Group, visit www.eitc-carolinas.org, or contact:
Lucy Gorham, director, EITC Carolinas: lgorham@mdcinc.org, or (919) 968-4531
Peter Skillern, executive director, Community Reinvestment Association of N.C.: peter@cra-nc.org or (919) 667-1557 ext. 22
Richard Hart, communications director, MDC Inc.: rhart@mdcinc.org, or (919) 968-4531
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