HungerNetOhio #8.1: Saving money for low income earners

Email conversations about "ending hunger in Ohio through changing conditions which cause poverty"

Too controversial to talk about these days? The subject is taboo in Washington and Columbus. It's out of favor with the public and, therefore, off the table with politicians.

TAXES!

However, here's a bit of common sense about making available common cents (as in money that is available to many Americans, especially those who “count their pennies”).

Many low income earners are unaware about monies-and services--they might have coming to them. Some are available through tax credits and others may be found through receiving good advice for reduction of other income taxes.

So, atypically, this column will be directed, not to members of the legislature, but to citizens employed in minimally paying jobs who might otherwise forfeit the little they earn. The advocacy needed for this task is toward those with the least.

Especially if you volunteer in a food pantry, soup kitchen, other outreach ministries or human service organizations, spread the word. You are in a special position for informing those on the economic edge about to file their tax returns this next month and a half that they may have more coming to (or not taken away from) them. Potentially extra savings and help are available.

Check these two websites and share what you learn with those in need:

• IRS
• Benefit Banks

At a time when many people are struggling from paycheck to paycheck, free tax services are helping eligible Ohioans put a few extra dollars in their pocket.

"The child tax credit, the Earned Income Tax Credit, the dependent care credit and the education credit - many individuals may not know they are eligible for these credits, or they just have not claimed them because of difficulty in understanding their tax return." More than $1.7 billion in tax credits and other supports go unclaimed each year by eligible Ohioans. More than 95 percent of these funds are federal dollars that, if claimed, would also help boost the state's economy.

There are 3 great options for FREE tax preparation for low--and moderate--income families.

The IRS (Volunteer Income Tax Assistance) VITA

These programs are accessible in hundreds of locations around the state. Generally prepare federal, state, and local taxes through e-file and can direct deposit. Generally, sites serve families that earn up to $48,000.

http://www.irs.gov/individuals/article/0,,id=234170,00.html#

The Ohio Benefit Bank

Led by the Association of Second Harvest Foodbanks, this public/private collaborative provides public benefits screening AND free tax assistance. The Ohio Benefit Bank has just under 1,200 locations and is available in all of Ohio's 88 counties. Eligible individuals can obtain free tax assistance by calling 1-800-648-1176 or visiting www.ohiobenefits.org.

http://admin.oashf.org/uploads/news/2011_Tax_Release.pdf

http://www.ohiobenefits.org/

AARP

Seniors can receive free tax assistance in AARP sites:

http://www.aarp.org/applications/VMISLocator/searchTaxAideLocations.action

Paid preparers can be very costly to working families and seniors. Despite the recent claim by several paid preparer chains who claim they will do taxes for free, this is only a 1040EZ form. State returns are extra. The Earned Income Tax Credit is extra. Other deductions and credits are extra. Roughly 10% qualify for only the 1040EZ.

Work Pays: Tax Credit a Boost for Struggling Ohioans

A little-known tax credit can be a shot in the arm for Ohioans struggling to make ends meet. The Earned Income Tax Credit (EITC) is a refundable federal income tax credit for low- to moderate-income working individuals and families. It's an important tool for those who earn a wage.

For tax years 2009 and 2010, the program was expanded as part of the American Recovery and Reinvestment Act. The average credit is more than $2,000 and the maximum credit for 2009 and 2010 is slightly more than $5,000. Families with three or more children are eligible for the EITC if they earn no more than about $43,000 annually.

Ohio Unemployment Claims Relapse to Job Destruction: George Zeller, Economic Research Analyst.

Work Pays: Tax Credit a Boost for Struggling Ohioans.

Policy Matters Ohio.

Ohio Association of Second Harvest Foodbanks. 

Free Tax Filing Can Help Ohioans Keep Money in Their Pockets.