Admit it -- in this challenging economic season, wouldn't we all like to see an infusion of an extra million dollars come in to our county?
A million dollars to be spent at our businesses, that would help struggling households, that would add a stronger layer of support for area residents?
There is a way we can do this over the next couple of months simply by increasing the number of applicants for the federal Earned Income Tax Credit (EITC).
The EITC is a credit for working people who do not earnhigh incomes. EITC can reduce a person's taxes and result in a refund.
In simple terms, workers keep more of what they earn.
Income and family size determine the amount of the EITC. The income amounts and the amount of EITC are adjusted for inflation each year.
In general, working families with children that have annual salaries below about $35,000 to $48,000 are generally eligible.
Also, lower-income working people without children that have incomes below about $13,000 ($18,000 for a married couple) can receive a smaller EITC.
The EITC is a significant economic resource for our community. In tax year 2008, the most recent year for which the IRS has released data, Walla Walla County brought in more than $7 million from the EITC, with the average household that claimed the credit realizing approximately $2,500 - 3,000.
In a few instances, the EITC can be worth over $5,000, depending on the amount of earned income and the number of qualifying children in a household.
John Wancheck of the Center on Budget and Policy Priorities, tells us that research shows that families use the EITC to pay for necessities like their rent, their bills, repairs to their homes, and to maintain vehicles that are needed to drive to work.
In some cases, people can use the credit to obtain additional education or training in order to improve their chances of getting a job and boosting their earning power.
Yet, despite the significant value of this tax credit to our community, it has been estimated that Walla Walla stands to gain an additional $1 million per year through increased application for the credit.
The IRS estimates that 20 to 25 percent of qualifying workers miss out on thousands of dollars every year because they fail to claim their EITC.
This includes workers who are: living in rural areas; self-employed; disabled; childless; not proficient in English; older (grandparents); recently divorced; unemployed; or those who have experienced other changes in their marital, financial or parental status.
The main reason why many EITC-eligible households do not receive this credit is that they must file for it even if their income is not high enough to require filing a 1040.
Thus, during tax season, we should encourage everyone who might be eligible to file for this credit, especially first-time filers. Research shows that most people who file for the EITC do so soon after receiving their W-2 forms.
Thus, educating people about the credit during January and February makes a significant impact in whether eligible households file or do not file.
So help spread the word. Encourage your co-workers, friends, family members and employees to apply.
Together, we can make the Walla Walla economy a millionaire this tax season!
Noah Leavitt is coordinator of the Walla Walla Asset Building Coalition.