“The Earned Income Tax Credit (EITC) is probably the number one cash benefit program for low-income families in the country,” according to Chris Rockey, senior vice president, market manager, Greater Maryland Community Development Banking for PNC Bank.
“It can be a challenge to get into the program,” Rockey adds, “but it is a way to put needed cash into a family’s pockets.”
The EITC was implemented as a way to offset the impact of Social Security taxes on low to moderate taxpayers and to provide them with an incentive to work. The credit can be worth up to $6,431 for 2018 and up to $6,577 in 2019 for families with three or more qualifying children. For taxpayers with two qualifying children, the maximum credit this year is $5,828. The maximum credit for one qualifying child is $3,526.
“The EITC is different than other federal assistance programs,” Rockey said, “because you actually have to have income in order to qualify.”
There are several ways individuals can determine if they are eligible for the EITC, Rockey explained.
“A number of community action associations through their financial programs are very aggressive about educating their clients about the EITC, as well as other programs like the CTC (Child Tax Credit),” he said.
Rockey also noted that he has seen a trend with Volunteer Income Tax Assistance (VITA) preparation sites whereby they are focusing on reaching out to working families to help them through the eligibility process.
“There are clearly efforts under way from an educational standpoint, “Rockey said, “but like any other government program it can be cumbersome, and unless you have someone who can help you navigate the twists and turns it can be confusing.”
In a best-case scenario, Rockey noted, a family or individual works with a case manager or social worker that is skilled in the process. He adds that by consulting with a VITA site, taxpayers can position themselves to be eligible for next year’s credit even if they are not signed up for the current tax year. It is also possible to apply for the benefit retroactively.
Rockey said that PNC Bank does not work directly with potentially eligible taxpayers to qualify them for the EITC, but it does explain how the program works and will refer them to its trusted community partners for intake. “Our partners can provide the information and resources our customers are looking for,” he said.
Still, obtaining accurate, reliable information about the EITC can be a challenge, Rockey warns. It is often difficult for those who need information about their eligibility to get access to transportation and take time off from work to meet with someone who can help them to qualify.
“It’s not just getting educated about the EITC,” he added, “it’s also about learning how to access the benefits while keeping their job.”
Even in the current divided political environment, Rockey is encouraged about the outlook for the EITC because over the years it has gained a great deal of bipartisan political support. In recent years, he adds, there has been some talk of trying to modernize some of the EITC’s income qualifications.
“Unlike federal programs that benefit individuals and families who are not in the workforce,” he said, “the EITC provides a direct benefit to the working poor. Whether you are an R or a D, you want more people in the workforce.”
