April 9, 2008

Eligible Rhode Islanders Should File for Earned Income Tax Credit, Whitehouse Urges

Free Tax Preparation Assistance Available at VITA Sites Statewide

Washington, D.C. – With the April 15th tax filing deadline now less than a week away, U.S. Senator Sheldon Whitehouse (D-RI) encouraged Rhode Islanders who may be eligible for the Earned Income Tax Credit (EITC) to file for this important tax benefit. Whitehouse urged those who have not yet filed a return or are unsure of their eligibility for the credit to call 1-800-829-1040 for information on free tax preparation services, available across Rhode Island through an Internal Revenue Service initiative.

“The EITC exists to make sure help is available for those who need it,” said Whitehouse, a member of the Senate Budget Committee who in January helped kick off the 7th Annual Providence Earned Income Tax Credit Campaign, coordinated by John Hope Settlement House. “The hundreds, or in some cases thousands, of dollars of tax relief this credit provides can help working families pay for housing, energy, or health care at a time when many are struggling to make ends meet. As we near the filing deadline for federal and Rhode Island income taxes, I hope every Rhode Islander who is eligible for this assistance files for and receives it.”

The Earned Income Tax Credit, a refundable federal income tax credit, is specifically targeted to working families with children and low-income working individuals. The credit can reduce tax burdens and even generate or enhance tax refunds for those whose credit exceeds tax liability. Everyone seeking to claim the credit must file a tax return. According to the IRS, funds received through the EITC are not taken into account when determining eligibility for Medicaid, Supplemental Security Income (SSI), food stamps, low-income housing, or Temporary Assistance for Needy Families (TANF) in most cases.

For tax year 2007, families earning up to $39,783 may qualify for the EITC. The income limit for a single individual with no qualifying children is $12,590. For a single parent with one qualifying child, the limit is $33,241 (or $35,241 for married couples filing jointly). The maximum credit, available to families with two or more qualifying children, is $4,716. Certain other income requirements also apply. More information about the EITC is available at www.irs.gov.

For tax year 2006, the latest year for which IRS data is available, 66,125 Rhode Island households had claimed the Earned Income Tax Credit as of June 30, 2007. The average benefit per Rhode Island household was $1,849, representing an infusion of more than $122 million into the state’s economy.

The Providence EITC Campaign works to inform working families about the EITC and offers free tax preparation services to help eligible families and individuals claim the credit. In 2007, the campaign reached more than 1,500 Providence households and helped claim $2.3 million in EITC and child care tax credits, according to John Hope Settlement House. In the past six years, the EITC campaign has also saved low-income Rhode Island taxpayers more than $1.2 million in tax preparation fees.

Through its Volunteer Income Tax Assistance (VITA) program, the IRS trains local volunteers in tax preparation and electronic filing. Taxpayers’ returns are prepared and filed free of charge. VITA sites across the state are open throughout this week, including locations in Central Falls, Cranston, East Providence, Johnston, Newport, Pawtucket, Providence, Smithfield, Wakefield, Warwick, Westerly, and Woonsocket. Information on locations is available at 1-800-829-1040.

Whitehouse also stressed the importance of filing a federal tax return for Rhode Islanders, especially seniors living on Social Security, who may be eligible for tax rebates through economic stimulus legislation passed earlier this year. Under the new law, the federal government will provide rebate checks, starting at $300, to low- and middle-income Americans, including many Social Security beneficiaries and disabled veterans or their survivors. These tax-free rebates will be sent automatically to eligible Americans who file a federal income tax return for 2007.

Whitehouse, who pushed Senate leaders to include stimulus rebates for seniors, joined with the IRS and the AARP last month to host three information sessions on the rebates in Pawtucket, Westerly, and Cranston.


Press Contact

Meaghan McCabe, (202) 224-2921