Federal and State Tax Credits Help Working Families Make Ends Meet:
Free Help Completing Tax Forms Available Statewide
As Oregonians receive their W-2 forms from their employers and tax forms from the state and federal revenue agencies, marking the beginning of tax season, thousands of Oregon families who worked last year will be eligible for federal and state tax credits that can reduce or eliminate their taxes. In some cases the credits might even provide additional funds to help families make ends meet. The Oregon Center for Public Policy (OCPP), a Silverton-based non-partisan research organization, wants to make sure that families who qualify get the credits and know they can receive free tax help.
The Federal government offers the Earned Income Credit (EIC) to working families. The EIC’s value is based on income and family size and can be worth up to $4008. The Federal Additional Child Tax Credit is available to working families with children. Even if a family has no tax liability, they can get money back from these credits.
Even families who do not earn enough money to have to file taxes, ought to,” advises John Lewis, administrator of the Oregon Center for Public Policy. “These families may still qualify for these federal credits. That could mean significant additional income for the family.”
Oregon provides working families with two credits, a state Earned Income Credit equal to 5 percent of the federal EIC , and the Working Family Child Care Credit, worth up to 40 percent of out-of-pocket child care expenses. While neither of the Oregon credits will give back more money than the family’s state income tax liability, the families may still get money back from the state if taxes were withheld by their employer over the course of last year.
Free help preparing state and federal tax returns is available from AARP and IRS sponsored “Tax-Aide” sites throughout Oregon. Trained volunteers are available to answer questions, help do taxes, and in some locations even file the taxes electronically (“e-file”).
“Low-income families do not need to pay someone to do their taxes,” said Lewis. “All they need to do is call 1-888-AARPNOW or 1-888-227-7669 and find the local Tax Aide site to get free assistance.”
“These credits all target their help to low-income families who work,” said Lewis. “Even though a family is working, it isn’t easy to make ends meet if you’re making seven or eight dollars an hour. The credits are a way of providing relief to those who need it the most.”
“These credits also provide significant economic benefits to Oregon,” said Lewis. The Federal EIC brings about $290 million in federal dollars to Oregon, for 194,000 households. “It is one of the biggest federal transfer payments into the state,” Lewis added. By contrast, the state receives only $169 million in federal welfare funds each year. “All the federal EIC dollars get into the hands of working families who tend to spend the money in Oregon,” said Lewis.
The Center’s outreach materials are also helpful for employers and organizations who have contact with Oregon’s low income workforce. “Employers should be telling their employees about these credits. Organizations who work with low-income families should be informing their clients about these credits. Every family who qualifies should be applying for these credits,” said Lewis. “No hard-working, low-income family should miss out on this opportunity.”
For organizations wishing to help inform families about these credits, the OCPP provides a poster as well as a brochure that may be photocopied. The materials are available in both English and Spanish.
For more information or to request these free outreach tools, contact OCPP at 503-873-1201.
For questions about federal taxes or to find the location of a Tax-Aide site contact the IRS at 1-800-829-1040. For questions about state taxes contact the Oregon Department of Revenue at 1-800-356-4222.