Friday January 19, 2007
Program Returns Millions in Refunds to Working Residents
Mayor Jerry Abramson announced today that the city and the Louisville Asset Building Coalition (LABC) will once again offer free tax preparation assistance to working families and residents who may qualify for the Earned Income Tax Credit (EITC). A family qualifying for the credit can receive up to a $4,500 EITC deduction. A family of four making less than $39,000 a year qualifies for the tax credit.
The city and the LABC have provided free tax assistance to more than 12,400 residents since 2001. Over the past five years, local families utilizing the services have received more than $18.5 million in refunds – $8.2 million of that total is a direct result of increased EITC deductions.
“In essence we have thousands of people in this community who are paying too much money to the federal government by not taking advantage of this tax credit for working families,” Abramson said. “We want to make sure our residents know about the credit, they can have help filling out the forms and that they are able to receive hundreds if not thousands of dollars in refunds.”
This year the city and LABC will coordinate the free tax preparation sites at 12 locations across Louisville. Organizers expect to prepare more than 4,500 tax returns this year, which will account for more than $7 million in refunds - $3 million a direct result of EITC deductions.
The Brookings Institution completed a study before merger illustrating areas where Louisville’s new government could improve. The study showed residents lose $26 million in federal tax income refunds because they qualify, but do not apply for the EITC deduction on their tax return.
Since merger, the city has worked with the LABC to increase awareness about the
availability of the deduction for working families. LABC offers free tax preparation sites utilizing certified volunteers to prepare returns. This service helps residents learn about the EITC deduction, complete their forms, file electronically, and allows families to save hundreds of dollars by having their taxes completed while avoiding high-interest refund loans.
“For some families, these refunds are the difference between accumulating more debt and starting a savings for a down payment on a home,” said Abramson. “We also realize that these refunds account for new money returned to our community that is re-invested in businesses throughout the city and region.”
In addition to MetroCall 311, this year the city will utilize Metro United Way’s new 211 information number to let residents know about EITC and the free tax preparation service. Metro United Way will also educate residents about EITC through its partner agencies.
“The LABC has done a tremendous job in creating economic stability and providing financial literacy for thousands in our community, but for everyone served by the coalition, there are several people eligible who are not aware of how they can participate. By working with our 90 participating agencies and by utilizing 2-1-1, Metro United Way will be able to connect more people to the LABC and help boost our local economy significantly,” said Joe Tolan, Metro United Way’s president and CEO.
This year the city and LABC have also formed a partnership with the National Disability Institute to help connect the disabled community with EITC services.
“We are excited about the new partnership with the National Disability Institute,” said Eric Seto, director of the LABC. “We know a significant percentage of working people with disabilities qualify for EITC, and now we will be able to effectively help more people apply for the credit.”
For a complete listing of locations, times, dates and additional information about free tax-preparation services call MetroCall 311, 211 or visit www.LouisvilleKy.gov.
LABC is a coordinated group of outreach agencies committed to helping residents build assets and gain self sufficiency. Key partners in LABC programming include the city, Annie E. Casey Foundation, Metro United Way and CE&S Foundation.