The Earned Income Tax Credit provides an opportunity for California workers to receive a financial boost. Are you wondering if you qualify for this credit? Let's find out.
February 24, 2020By Amy Everitt
If you find yourself putting in all your effort but struggling to meet your financial obligations, take comfort in the fact that you're not alone. Studies indicate that a staggering 80% of Americans rely on their income solely to cover their day-to-day expenses, leaving little room for savings or unexpected costs. In fact, nearly half of the population would struggle to pay off a sudden $400 expense. This data serves as a stark reminder of the financial hardships faced by many hardworking individuals in the United States.
California, known for its high cost of living, is facing a situation where the wages of the majority of workers are not sufficient to meet the ever-increasing expenses in housing, healthcare, food, and transportation. However, what might astonish you is the fact that low-wage workers in California are missing out on over $2 billion dollars annually.
Yes, it's true. Numerous individuals, who are putting in endless hours of work to support their loved ones, are unknowingly forfeiting hundreds or even thousands of dollars that could be utilized for paying rent, establishing a savings account, or buying a vehicle. This unfortunate situation arises solely because they neglect to file their taxes.
If your total income last year was below $56,000, you have the chance to be eligible for the federal Earned Income Tax Credit, which is a credit that provides cashback for employees, giving you the opportunity to receive money in return. Moreover, if your earnings were $30,000 or less, you may also be eligible for the California Earned Income Tax Credit (CalEITC). Additionally, as of this year, California is introducing the Young Child Tax Credit, where parents with a child aged 6 or below could potentially receive an extra $1,000. However, it is imperative that you file an income tax return to avail of these credits. Depending on the size of your family and your income, these combined credits have the potential to give you and your loved ones up to $8,000 in returns!
Studies indicate that the Earned Income Tax Credit (EITC) has numerous beneficial effects on a family as a whole. Research demonstrates that the inclusion of EITC has a favorable influence on the well-being of children, leading to improved health, higher academic performance, and an increased likelihood of pursuing higher education. Moreover, it has been observed that individuals who had parents receiving an EITC boost during their upbringing tend to have higher earnings as adults compared to their counterparts from eligible families that did not receive the EITC.
CalEITC4Me and our collaborators offer assistance and materials that enable you to submit your tax returns at no cost, eliminating the need to needlessly part with a significant portion of your refund in fees paid to profit-driven tax preparers. With the aid of IRS-certified volunteers, individuals can avail themselves of the Volunteer Income Tax Assistance (VITA) program, which provides a reliable and hassle-free avenue for submitting tax returns.
Gloria Saucedo, a resident of Lynwood and a parts inspector at a local factory, recently had her taxes prepared by a VITA preparer. As a result, she received a refund of several thousand dollars, which included the Young Child Tax Credit. Saucedo intends to deposit this money into a 529 college savings account for her 2-year-old son, Jorge.
Don't miss out on any money this year! To get your refund and locate a nearby VITA location, head to CalEITC4Me.org or text 'EITC' to 555-888. It's important to claim what's rightfully yours!
Amy Everitt is the head of Golden State Opportunity, a nonprofit organization committed to eradicating poverty in California. She proudly represents the 5th generation of her family to be born and raised in the Golden State.