Philly continues urging residents to claim critical tax credit for low-income workers

Rosalyn Sanders (right) received the Federal Earned Income Tax Credit in 2015. (Kimberly Paynter/WHYY)

Rosalyn Sanders (right) received the Federal Earned Income Tax Credit in 2015. (Kimberly Paynter/WHYY)

Philadelphia officials continue urging residents to apply for a tax credit considered one of the country’s most-effective anti-poverty programs.

The earned income tax credit — or EITC  — is designed to help get families rise above the poverty line by offsetting how much low-income workers pay in federal income taxes. Low-income workers often use the money to make major purchases, such as a new car, or to pay off overdue bills.

In Philadelphia, EITC recipients get back an average of $2,500.

But according to Philadelphia’s Revenue Department, about 40,000 city residents who are eligible for the EITC don’t take advantage of it, leaving a combined $100 million on the table.

So last year, the city spent $1 million on an awareness campaign that included a multilingual website; ads on Pandora; street teams handing out information to businesses; and free tax preparation sites across the city.

Because of a lag in data available from the Internal Revenue Service, it’s not clear whether the effort reduced the number of people missing out.

But city officials claim it’s working. For instance, the number of people who came to the city’s free tax preparation sites went up from about 5,000 in 2015 to roughly 17,000 in 2016.

“We are getting really great feedback from folks,” said deputy revenue commissioner Marisa Waxman. “We know that more folks are coming into those free tax prep centers. We can look at things like web hits and calls to the hotline and social media shares. So we know that folks are getting the message.”

In 2017, the city is spending another $1 million to keep the campaign going, but it is making some tweaks.

Many residents don’t apply for the EITC because they assume they need to have children to qualify or because they worry it could disqualify them from receiving government benefits, such as Supplemental Nutrition Assistance Program money. Neither is true.

Waxman said residents who have their taxes done by professionals don’t fall prey to these misconceptions and providing the service for free avoids cutting into the dollars low-income families get back from the federal government.

This year, the city is putting an even larger share of the money behind the campaign toward expanding capacity at the free tax preparation sites and adjusting hours to make them more regular and convenient. The city will also be expanding the number of tax preparers fluent in other languages.

“If you come to our Northeast site, if you want to have your taxes done in Albanian, Turkish, Russian, that’s all an option,” said Waxman.

“Language access has been really important, really making sure these are robust locations that can provide services when folks need them in the way folks need them,” she added.

The Revenue Department is also partnering with the School District of Philadelphia to get the word out to teachers and parents who may be eligible for the credit.

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