California’s Franchise Tax Board (FTB) is expecting about 825,000 low-income working taxpayers to qualify for an average refundable credit of $460 through the state’s new Earned Income Tax Credit (EITC). As of last month, 26 states and the District of Columbia have established their own EITC’s as a supplement to the federal poverty-reduction measure; more than 27 million working families and individuals received the EITC in the 2013 tax year.
According to Chris Smith, Tax Practitioner Liaison from the state’s FTB’s Taxpayers’ Rights Advocate Office, FTB anticipates that the California EITC will attract some 65,000 new tax return filers in the upcoming filing season. Because those eligible for the state credit will also be eligible for federal EITC, many low-wage earning Californians will experience a significant income boost, which could help them meet monthly expenses and take advantage of key asset building or debt reduction opportunities.
Smith’s presentation opened the Alameda County Community Asset Network (AC CAN) September 8 quarterly Stakeholder Convening where he was joined by other experts who were invited to discuss issues raised by the state’s new EITC program and to examine ongoing and emerging tax policy reform initiatives. Guest presenters included Laura Freeze, Program Specialist at United Way of the Bay Area’s Earn It! Keep It! Save It! (EKS), and Rosalyn Epstein, MSW, Family Economic Success Coordinator at East Bay Asian Local Development Corporation (EBALDC), both of whom addressed a range of practical matters from EITC outreach strategies to integrating financial capability and asset building programs into their agencies’ VITA tax preparation work flows.
Christopher Brown, Director for Financial Security, at PolicyLink shared how a national coalition, the Tax Alliance for Economic Mobility, is urging policy makers, advocates, service providers, and even EITC recipients to invert our “upside down” tax code so that benefits (mortgage interest deduction, preferential investment income rates itemized deductions, etc.) no longer accrue only to the affluent.
AC CAN has compiled all of the meeting’s printed materials (including speaker presentations and handouts) in a post-conference packet, which you can access here, or by directly contacting AC CAN. If you’re not an AC CAN member, we encourage you to join; or if you would like to receive a copy, join our distribution list, or just learn more about AC CAN, email us at [email protected].