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Volume 6, Issue 1, 2006   Federal Reserve Bank of Dallas

EITC Initiatives in the Fed's Eleventh District

Throughout the Eleventh District, communities are taking innovative steps to get the word out about the Earned Income Tax Credit.

The Asset Building Coalition of Dallas estimates that $65 million in EITC refunds were left unclaimed last year by eligible Dallas taxpayers. This year the mayor of Dallas, along with a state senator and state representative, appears in a public service announcement in both English and Spanish encouraging people to find out if they qualify for the EITC and promoting the toll-free IRS number, 1-800-829-1040. The announcement began airing on local cable and network TV channels in January.

According to IRS agent Dolores Herrera, the four tax coalitions in Southern New Mexico have a combined goal of helping 4,000 taxpayers file their returns this year. The city of Las Cruces is spearheading the Las Cruces Files for Free program and will have five new and one existing VITA site. Representatives from the United Way of Southwest New Mexico and the U.S. Department of Housing and Urban Development are also involved in the Las Cruces program.

Like Las Cruces, the city of San Antonio leads a local tax coalition. The San Antonio Coalition for Family Economic Progress is one of the top-producing tax coalitions in the U.S., having assisted with the preparation of almost 25,000 tax returns in 2005. The coalition promotes awareness of the EITC through partnership efforts with local community groups, notices in city water bills, and radio and TV ads. The city even requires its social services contractors to notify their participants and employees of the credit.

Rosa Salinas, a San Antonio taxpayer who received help with her return last year, goes to her local city library VITA site because it is conveniently located to her home and work. She is so happy with the results that she's told friends and family about the program.

Before learning about the VITA program, she paid about $200 for tax preparation. Although her annual income is around $22,000 and federal tax withheld from her paycheck is minimal, with the EITC credit her refund exceeded $3,000, she was thrilled to learn. And she spent nothing on tax preparation.

In addition, because the VITA site provides free electronic filing and she selected direct deposit to her bank account, the turn-around time from filing to receipt of the funds was only seven days. Salinas chose direct deposit because she feels "it is more secure, faster and hassle-free."

To locate the nearest VITA site, call 1-800-829-1040. Information on Tax-Aide locations is available at the AARP web site, www.aarp.org Off-site page.

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e-Perspectives, Volume 6, Issue 1, 2006

Federal Reserve Bank of Dallas Off-site page
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Jackie Hoyer Send an e-mail
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Community Development Specialist
The views expressed are the authors' and should not be attributed to the Federal Reserve Bank of Dallas or the Federal Reserve System. Articles may be reprinted on the condition that the source is credited and a copy is provided to the Community Development Office.

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