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Free Tax Prep Nets $6.4M
by Melissa Bailey | Apr 26, 2013 3:17 pm
Posted to: Social Services
Volunteers like Ariella Kristal and Amalia Skilton (pictured above) helped low-income working families win millions of dollars in tax refunds, and avoid getting gouged by thousands of dollars in fees, at free tax preparation sites across the city this year.
Officials made that announcement at an annual recognition reception Thursday for the Volunteer Income Tax Assistance program at the New Haven Free Public Library at 133 Elm St.
The federal program helped 3,849 New Haven individuals and families file their taxes for free, saving $577,350 in tax preparation fees. It helped them avoid getting ripped off by local tax preparers that charge fees and snooker cash-needy clients into costly “advances” on refunds. (Click on the video for a 2007 interview with a costumed mascot from one of those companies.)
The program helped families win $6.4 million in federal and state tax refunds for the 2012 tax year. That includes $2,125,723 from the federal Earned Income Tax Credit (EITC) program. The federal program, a tax credit for the working poor, has been touted by politicians red and blue, including Ronald Reagan, as the single most effective anti-poverty initiative. Formed in 1975 as a way to get the poor off the public dime and into the workforce, the federal program offers up to a $5,891 payment for a family who paid income and payroll tax. The payment serves as a bonus after a year of hard work: It often exceeds the amount of taxes the family paid.
For the second year, Connecticut has also sent money to the working poor through a state version of EITC equivalent to 30 percent of the federal EITC.
Volunteers worked at 13 sites around town, including the main branch of the New Haven Free Public Library, where Kristal and Skilton organized a brigade of 60 Yale volunteers. The team worked 16 hours a week, completing 592 tax returns.
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i’m glad this program has helped so many people navigate the byzantine tax code and get the money back they’ve earned, but i never thought i’d see a tax refund described as akin to winning money!
a tax refund is remittance on a 0% loan you’ve given the government from your pay check all year.