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Sunday, February 25, 2024

Dollars & Sense

Don’t miss out on tax breaks from the Earned Income Tax Credit and Child Tax Credit.

Tax season does not have to be stressful. It can actually be a very good time of the year for you and your family if and only if you know what tax credits at the Federal and DC level you are eligible for and get them.

At tax time, over 50,000 Washingtonians are eligible to receive the federal Earned Income Tax Credit (EITC), the DC EITC, and the Federal Child Tax Credit, which can provide people a much needed income boost and reduce any federal taxes owed – but not everyone is aware of their eligibility. People who worked in 2022 could qualify for extra money from these credits that could help them afford the rising costs of essentials like food, clothing, and shelter. Eligible individuals and families must file a federal tax return by April 18, 2023 to get these tax benefits.

The Earned Income Tax Credit helped over 55,000 Washingtonian families claim over $110 million in the Federal EITC last year. Additionally, they were able to receive a 40% match from the DC EITC. For 2022, each eligible worker aged 25-64 without kids could receive as much as $560, and workers with kids at home could receive up to $6,935. To qualify for the federal EITC, Washingtonians must have a Social Security number for everyone listed on their tax return and must have earned under $22,610 without kids or less than $59,187 with kids in 2022. A person may be eligible for the EITC if they worked at any point during 2022, even if it was part-time, temporary, or gig work. Additionally, the DC EITC can provide a 70% match of the Federal EITC.

The Child Tax Credit helped over 60,000 Washingtonian families claim over $111 million in Child Tax Credit refunds last year. Households eligible in 2022 could receive up to $2,000 for each child under 17 years old. Up to $1,500 of the Child Tax Credit is available as a refund to families that earned more than $2,500 in 2022. Adults with an Individual Taxpayer Identification Number (ITIN) issued by the IRS who have a child with a Social Security number in their household could be eligible for the credit.

Because of the pandemic, the EITC and Child Tax Credit were expanded and made available to more families in 2021. That expansion has since ended, BUT here’s the good news – if a person was eligible for the 2021 expanded EITC, the 2021 expanded Child Tax Credit, or any of the three rounds of stimulus checks and didn’t claim them, it’s not too late! Washingtonians can still file for last year’s expanded credits this year.

Throughout the tax filing season, great non-profit organizations in DC—Catholic Charities-Archdiocese of Washington, United Planning Organization, and Community Tax Aid to mention some of the primary ones—have been assisting Washingtonians to file their Federal and DC taxes for free. For people filing for the first time or who need help completing their forms before the April 18th deadline, free resources for support are available. You should visit GetYourRefund.org to connect online with an IRS-certified volunteer or file your own taxes.

Please remember, this is your money! You should get it. Don’t let Uncle Sam keep money that belongs to you.

At Capital Area Asset Builders (CAAB) we are committed to assisting Washingtonians learn of and claim the Earned Income Tax Credit—at the Federal and DC levels—and the Child Tax Credit to boost their income and help them with the high cost of living. We want you to get your money and use it to achieve your family’s financial goals. High-quality, trusted, reliable and free tax preparation services are available for Washingtonians who made up to $60,000 in income last year. For more information on these in-person, virtual and online services, visit www.caab.org/en/dceitc.

CAAB is a Washington, DC-based non-profit organization with a mission to create opportunities for low- and moderate-income individuals in Washington, DC and the greater DC region to build financial security, savings, and wealth for the future. Through our DC EITC Campaign we provide access to information on the EITC and inform Washingtonians on free tax preparation services throughout the District of Columbia and online. The DC EITC Campaign is made possible through the support from the DC Department of Insurance, Securities and Banking (DISB) as well as other key private sector partners.

Joseph Leitmann-Santa Cruz is the CEO & Executive Director of the Washington, DC-based non-profit organization Capital Area Asset Builders.

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