A couple of years ago, when I was hanging out at an AccountAbility free tax prep site, I saw a family walk away with a larger refund because they qualified for the Earned Income Tax Credit. The EITC is a credit for people who work but don't earn high income.
The extra cash, which they had not expected, was going to help this family pay some outstanding bills. Hopefully there was a little left over to save.
The IRS declared January 29 EITC awareness day because an estimated one in four taxpayers who qualify for the refundable tax credit don't claim it.
Nearly 24 million people received $50 billion in benefits with an average credit exceeding $2,000, the IRS said.
About 292,200 individuals or families received an average $1,810 EITC in Minnesota last year.
The agency is expecting even more people to qualify this year because of the numbers of workers dealing with job loss or reduced incomes.
This year, the credit is even more generous. "As part of the economic recovery efforts, there have been important changes to expand EITC to benefit taxpayers," said IRS Commissioner Doug Shulman. "Today, more than ever, hard-working individuals and families can use a little extra help. EITC can make the lives of working people a little easier."
Here's the skinny, courtesy of the IRS:
