I update this column every January as it is a very important topic. Earned Income Tax Credits (EITC) and other tax credits are available to working families that may result in an income tax refund, even if you don’t owe any taxes this year.
The EITC is a federal income tax credit for low-income working families and is a refundable credit, which means even if you owe little or no income tax, this credit is part of your tax refund.
The Internal Revenue Service estimates many who are eligible for this credit do NOT file an income tax return or know about the credit. Please pass the word and educate family and friends that they may be eligible and should see if they should file. The continuing poor economy, e.g., under-employment and unemployment, means many qualify for the EITC.
For 2012, the Internal Revenue Service website states the following:
Earned income and adjusted gross income must each be less than:
• $45,060 ($50,270 married filing jointly) with three or more qualifying children
• $41,952 ($47,162 married filing jointly) with two qualifying children
• $36,920 ($42,130 married filing jointly) with one qualifying child
• $13,980 ($19,190 married filing jointly) with no qualifying children
The maximum credit for Tax Year 2012 is:
• $5,891 with three or more qualifying children
• $5,236 with two qualifying children
• $3,169 with one qualifying child
• $475 with no qualifying children
Investment income must be $3,200 or less for the year.
Also check out two other tax credits that may be available to help households raising children: the Child Tax Credit and the Child and Dependent Care Tax Credit (the latter credit is not refundable; it only reduces taxes you owe).
To take advantage of these tax credits, you MUST file a federal income tax return, even if you do not earn enough to owe any income taxes. Taxpayers have until Monday, April 15, 2013 to file their 2012 tax returns and pay any tax due. If you itemize deductions (using Form 1040 Schedule A), you should wait until mid-February as there are often updates in the tax laws.
Free Tax Preparation and Filing Services
You may be eligible for free assistance preparing and filing your income tax return. The specific eligibility figures have not yet been released for 2012. These sites open in February and there are usually several locations in Grays Harbor and Pacific (days and hours vary):
Ocean Park Library, Raymond Timberland Regional Library, McCleary Timberland Library, Ocean Shores Library, Quinault Indian Nation, and at the South Shore Mall. AARP also provides free tax help to people age 60 and older through its Tax-Aide program, which will be available at the same locations. For more information, call 2-1-1 or call 1-888-227-7669 or visit www.aarp.org.
To find out if you are eligible for Northwest Justice Project services:
For cases including youth (Individualized Education Program and school discipline issues), debt collection cases and tenant evictions, please call for a local intake appointment Tuesdays and Thursdays from 9:00 a.m. to 1:00 p.m. at (360) 533-2282 or toll free (866) 402-5293. No walk-ins, please.
For all other legal issues, please call our toll-free intake and referral hotline commonly known as “CLEAR” (Coordinated Legal Education Advice and Referral) at 1-888-201-1014, Mondays through Fridays 9:10 a.m. to 12:25 p.m. If you are a senior, 60 and over, please call 1-888-387-7111; you may be eligible regardless of income. Language interpreters are available. You can also complete an application for services at http://nwjustice.org/get-legal-help.
Sarah Glorian is the senior attorney for the Aberdeen office of the Northwest Justice Project, a private, non-profit legal aid organization providing free representation to low-income residents in Grays Harbor and Pacific counties.