Tax Credits for Working Families Are Worth Thousands of Dollars This Year
Outreach Campaign Spreads the Word so Eligible Families Don't Miss OutJanuary 27, 2011
(Washington, D.C.) Today the National Women’s Law Center (NWLC), in partnership with organizations around the country, is launching a Tax Credits Outreach Campaign to ensure that more low- and moderate-income families are aware of and claim available federal and state income tax credits.
“The goal of the campaign is to get the word out to families about these credits so they don’t miss out on a valuable opportunity,” said Nancy Duff Campbell, Co-President of the National Women’s Law Center. “Federal and state tax credits can make a real difference for working families this year as they continue to struggle to make ends meet.”
The launch of the campaign coincides with Earned Income Tax Credit Awareness Day, an effort of the Internal Revenue Service to inform the public about the Earned Income Tax Credit and the requirements to claim the credit. As part of the NWLC campaign, state child care organizations, social service providers, and advocates will work to educate families about both the Earned Income Tax Credit and other valuable federal and state tax benefits as well as the availability of free tax preparation assistance in their communities.
Federal and state tax credits can help offset the cost of child care and other expenses for working families. For 2010, families may be eligible for a number of federal tax credits, including:
- Earned Income Tax Credit, which helps provide a wage supplement for low and moderate-income families (those earning less than $48,362 annually). This credit is worth up to $5,666, and is refundable.
- Child Tax Credit, designed to help families offset some of the costs of raising children. This credit is worth up to $1,000 per child. Families who owe little or no income tax can receive some or all of this credit as a refund if they earned at least $3,000 in 2010.
- Child and Dependent Care Tax Credit, designed to offset some of the child or dependent care costs that families incur in order to work. This credit is worth up to $2,100, though the amount that can be claimed is limited by a family’s federal income tax liability.
- The Making Work Pay Credit, designed to increase families' take-home pay. This refundable credit is worth up to $800 for couples.
Some states offer their own family tax benefits as well: Twenty-eight states, including the District of Columbia, offer child and dependent care tax provisions, 23 states offer earned income tax credits and three states offer child tax credits.
“Families must file a tax return and claim these credits, or they will miss out on benefits for which they are eligible,” Campbell said.
NWLC has developed an online resource for parents and advocates with user-friendly fliers about both the federal credits and individual states’ tax provisions. Materials are available in Spanish and other languages. To learn more about federal and state tax credits, visit www.nwlc.org/LowerYourTaxes.