Each year, low-income families miss out on the chance to receive a tax credit that could help them move out of poverty, as millions of dollars go unclaimed in the government’s Earned Income Tax Credit (EITC) program. The EITC is a refundable federal income tax credit available to low income families, but many eligible families and individuals do not file for the EITC, whether due to lack of knowledge about the credit, uncertainty about how to apply, or other reasons.

Approved by Congress in 1975 to offset social security taxes and to provide an incentive to work, the EITC has been credited with lifting more children out of poverty than any other single program. Research indicates that families use the EITC to pay for necessities, repair homes and vehicles needed to commute to work, and to boost their earning power by obtaining additional education or training.

NPower Seattle’s EITC Project partners with nonprofit organizations that serve low-income communities to teach their clients how to use free technology tools that calculate EITC eligibility and file tax returns. We focus on the nonprofit staff providing them with the information and tools they need to reach their clients more effectively by offering staff training, customizable outreach templates, training materials, and an interactive toolkit on Using Free Online Tools.

The immediate goal of the project was to inspire more widespread use and accelerate the adoption lifecycle of technology tools that address the problem of unclaimed Earned EITC credits. Secondarily, we wanted to achieve a $2 million increase in the tax credits received by Washington State low-income families and individuals in 2006 and 2007. Longer term, the project will demonstrate the effective adoption of online tools by low income families and individuals in our community to access services and to advocate for their needs.

WHAT WE NEED:

Many non-profit organizations already have trusted relationships with the low income families and individuals we wanted to reach, but in order for us to leverage those relationships we first needed to create awareness of this issue with the organizations, then create incentives for them to think differently about their service delivery options in light of the new capabilities online technology tools afford. We created the materials and tools needed to support this outreach and identified a cohort of early adopters to whom we provided training on technology tools in the areas of outreach, awareness raising and actual filing of taxes.

Location