Millions of people miss out on federal tax benefits each year because they don’t know about them. The IRS estimates that about 19% of eligible Vermont workers don’t claim the Earned Income Tax Credit (EITC). The EITC is one of the nation’s largest and most effective anti-poverty programs. On average, EITC adds $2,455 to working families’ tax refunds. Workers earning less than about $50,000 from wages, self-employment, or farming could qualify. The amount of the credit is based on several factors, including the amount of income. Except in the case of some disability retirement income, people who do not work or run a business or farm generally do notqualify for the credit. For a married couple filing jointly, only one spouse needs earned income.
Vermont also supports working families with the Vermont EITC. Vermont’s EITC is 32% of the federal amount. Vermont workers who qualify for the EITC often qualify for a renter rebate or property tax adjustment as well.
EITC supports food security for children
Many families are unaware that receiving the EITC makes them eligible for food and nutrition benefits. Families who receive the Vermont EITC and have children can get 3SquaresVT (formerly food stamps) without having to meet the income test normally required. Children whose families get 3SquaresVT, in any amount, automatically get free school meals. You can find a flyer about this here (link is external).
There is free tax help available
- The online EITC Assistant at irs.gov/eitc (link is external)helps people determine their eligibility.
- Individuals and families who made less than $54,000 in 2016 can have their state and federal taxes prepared for free at local sites. Call 2-1-1 for details or go to irs.gov/vita (link is external).
- Individuals and families who made less than $64,000 in 2016 have two ways to prepare and e-file their tax returns online for free. Go to irs.gov/freefile (link is external)or myfreetaxes.com (link is external).
- If the IRS asks you to prove your eligibility for EITC or another credit, Vermont Legal Aid’s Low-Income Taxpayer Clinic can help. Call 800-889-2047 or visit vtlawhelp.org
Friday, January 27 is Earned Income Tax Credit (EITC) Awareness Day. Vermont Low-Income Taxpayer Clinic Director Christine Speidel appears on Channel 17 to provide information about EITC for this tax season, accompanied by Grant Peterson (Senior Stakeholder Relationship Tax Consultant, IRS), Robert Fett (Local Taxpayer Advocate for the State of Vermont), and Michael McClintock (VITA Tax Site Coordinator, Chittenden County Community Action). Watch Channel 17 at 1:30pm, 3:00pm, and 6:00pm on January 27 (or click the videoplayer below) for information about EITC.