Why should Georgia have a state EITC?

January 29th, 2016 by

In honor of #EITCAwarenessDay, learn how a state Earned Income Tax Credit (EITC) would positively impact our state and community.

 

How a state EITC would benefit families –

A state Earned Income Tax Credit (EITC) would provide a bottom-up tax cut that would benefit more than a million Georgia families and put an estimated $270 million back into the pockets of working Georgians.County EITC Map Branded

More specifically it would benefit:

  • An estimated 770,000 working mothers and 410,000 working
  • An estimated 80,000 military veterans and their
  • An estimated 2 million children.
  • Over a million Georgia households representing 6 million Georgians.

Georgia should create a state Earned Income Tax Credit to help Georgians with jobs afford the basics and work their way into the middle class.

  • The tax credit lets low- and moderate-income working families keep more of what they earn to help meet basic needs and pay for things that allow them to keep working, such as child care and transportation.
  • This helps families as they get a toehold in the workforce or deal with temporary setbacks like having their hours or pay reduced or a family breadwinner laid off.
  • For families with very low wages, the credit increases with each dollar earned, which encourages them to work more hours. That additional experience in the workforce can lead to higher pay and better opportunities. The tax credit phases out after recipients reach a modest income level.
  • This tax credit offers working families a hand up by encouraging and supporting work and reducing use of public assistance. It’s a modest investment that can make a big difference in the lives of working families.
  • If someone doesn’t work and pay taxes, they can’t receive this help. It only goes to people who earn income through low-wage work, most of them raising children.

How a state EITC would benefit small businesses, local economies and Georgia’s future workforce.

  • The Earned Income Tax Credit boosts local economies across the state by helping low-wage workers keep more of their income, which they spend at local businesses to buy groceries, pay for car repairs, or afford child care.
  • And businesses like this tax credit because workers who can pay for basic necessities are more dependable employees because they can better afford reliable transportation to get to work and child care for their kids.
  • The EITC is a proven tool to strengthen tomorrow’s workforce because young people receive an outsized benefit. Research finds that children and young adults in families receiving the EITC do better in school, graduate high school and attend college and succeed in the workforce.

To view full report: the case for a state Earned Income Tax Credit

Download Georgia Budget & Policy Institute’s State EITC Fact Sheet

ABOUT NATIONAL EITC AWARENESS DAY


EITC Awareness Day is a national grassroots effort to draw attention to the Earned Income Tax Credit and the enormous positive benefit it has on working families across the country.

 

Tax Time = Time to Save

January 20th, 2016 by

Did you know that retirement is the only thing you can’t borrow money to do? Tax time provides a great opportunity for people
retirementto start saving for the future, which will be here before you know it. Even setting aside a small portion of your refund is a great start. For those who haven’t found an easy way to save, myRA (my Retirement Account) is a great place to start. This tax season, tax filers can get on the path to more secure retirements and, if eligible, take advantage of the Saver’s Tax Credit with myRA.

What is myRA?

myRA is a new starter retirement savings account developed by the U.S. Department of the Treasury. It may be a good savings option for many tax filers, especially for those who don’t have access to retirement savings plans at work — like small business employees, part-time and temporary workers, and the self-employed. myRA is a Roth IRA1 that was designed to remove common barriers to saving and make it easy to get started. Saving with myRA is simple, safe, and affordable:

  • No cost to open, no minimums, and no fees
  • No complicated investment options
  • No risk of losing money
  • Backed by the U.S. Treasury
  • Savers choose the amount to contribute1
  • Money deposited is available when it’s needed2

Tax filers can make the most of their federal tax refunds with just three simple steps:

  1. Open a myRA account before filing a tax return by visiting myRA.gov or calling 855-406-6972.
  2. Provide the appropriate myRA account and routing numbers (111925074) to your tax preparer and indicate the amount of the federal tax refund that should be directed to the myRA account. If depositing a refund into multiple accounts, Form 8888 will need to be completed.
  3. Ask your preparer if you are also eligible for the Saver’s Tax Credit. Individuals may be eligible if they contribute to certain types of retirement savings accounts, like myRA.

Need help getting your taxes prepared? Contact the Volunteer Income Tax Assistance (VITA) program at Neighborhood Improvement Association to find a free tax preparation site near you: 912.447.5577 or www.niacdc.org


1Annual and lifetime contribution limits and annual earned income limits apply, as do conditions for tax-free withdrawal of interest. To learn about key features of a Roth IRA and for other requirements and details, visit myRA.gov/roth-ira.

2Interest earned may be withdrawn without tax and penalty five years after your first contribution if you are over age 59 ½, or if you meet certain other conditions, such as using the funds for the purchase of your first home.