Earned Income Tax Credit: It could mean thousands in refunds -- how it works

Rod Meloni walks us through the requirements for claiming the earned income tax credit.

Today’s Money Minute is about a too often ignored and under utilized tax credit for lower income earners. It could mean thousands of dollars in tax refunds -- but it’s complicated.

The Earned Income Tax Credit (EITC) helps low- to moderate-income workers and families get a tax break. If you qualify, you can use the credit to reduce the taxes you owe – and maybe increase your refund.

The amount of your credit may change if you have children, dependents, are disabled or meet other criteria. (Click here to check your eligibility with the IRS)

Find more info on the EITC here from the IRS.

The City of Detroit is working with several community-based organizations to continue its annual push to encourage Detroiters to file their taxes and claim their refunds. As a result of the City of Detroit’s annual EITC campaign, Detroiters have claimed $56 million more in EITC refunds each year on average. Prior to 2017, EITC-eligible Detroiters left an estimated $80 million of potential tax refunds unclaimed each year.

The United Way is offering tax help on this subject -- more info here. Make an appointment for tax help today by calling 2-1-1 or going online at GetTheTaxFacts.org

“Accounting Aid Society recognizes that families and individuals in our community want accessibility, flexibility, and safety. Our in-person, virtual, and drop-and-go tax filing options provide just that, allowing clients to fit tax preparation into their schedules and providing assistance for those without an existing tax site in their neighborhood. After a hard stop in March of 2020, in-person tax preparation is back at five locations across Detroit, providing the dependable service our clients deserve,” said Priscill Perkins, President and CEO of Accounting Aid Society.

About the Author:

Rod Meloni is an Emmy Award-winning Business Editor on Local 4 News and a Certified Financial Planner™ Professional.