New California Tax Credit For Low-Wage Workers
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March 15, 2016 1:19 p.m.
New California Tax Credit For Low-Income Families
Shaina Gross, senior vice president, United Way of San Diego County
Related Story: New California Tax Credit For Low-Wage Workers
It's just a month until the income tax deadline of April 15. Among the new forms and provisions in this year's taxes is a new state earned income credit. Lawmakers say the tax credit will help tens of thousands of Californian's living below the poverty line. Some say the credit still neglects a number of the working poor. From KQED's government and politics desk, Katie more reports.
Getting taxes done is always hard. A single mom makes very little. Anderson Munoz says most of her income goes towards housing. While she does get some government assistance --
It goes so fast. Getting a refund is like Christmas in February or March.
This year refund might be bigger. To find out how much bigger, Anderson Munoz has come to a free tax preparation event in Sacramento. Because of her financial situation, she might be eligible for California's new earned income tax credit or EITC. It is targeted to Californians with the lowest incomes, people like Anderson Munoz.
The idea of getting a little bit extra from the state is like a breath of fresh air.
The EITC provides a tax refund to people making less than $14,000 a year. The state franchise tax Board says a family that qualifies will get an average of $900. Assembly member Tony Akin says that is a lot of money, especially when paired with the federal EITC.
We think it is pretty significant in terms of helping the lowest and most vulnerable working California's be able to maximize a little bit of the tax credit. And if they combine it with the federal tax credit, it could mean that he significant resources for struggling, working California family.
Atkins pushed hard for the new tax credit which will benefit about 2 million people at a cost of about $380 million. But she acknowledges lawmakers make it a conscious decision to target the EITC towards a smaller group of very poor Californians rather than giving a smaller benefit to more people. Still, Alissa Anderson with the budget and policy Center says the tax credits narrow focus leaves a lot of families behind.
For example, appear with two kids who is working full-time all year long at the minimum wage has income right around the poverty line. But actually earns too much to qualify for the new credit.
Anderson also question the states to --
Workers who are having trouble finding a job with an employer but who have the motivation to start their own business or patch together a jobs to try to make and meets will be eligible for the credit.
Assembly member Akin says she'd like to see the credit expanded in the future to include more people. But first they have to make sure people who are eligible now take advantage of it.
The quicker you get this information out the better. I recall when I was a minimum wage earner, I filed my taxes as soon as I could because it meant money back, typically.
Back at the Sacramento tax preparation event single mom Anderson Munoz waits patiently to hear whether she qualifies for the states new credit. After plugging in the numbers, tax preparer Diane tells Anderson Munoz she does.
Do you want to know the amount?
Oh my goodness. Are you kidding me?
In addition to your federal income.
Thank you, so much.
Between the federal and state tax credits, Anderson Munoz will get more than $5000 back. She said she plans to use some of it to throw her daughter a sweet 16 party.
That was KQED Katie or reporting. Joining me now more on the state -- tax credit and we can get help is Shaina Gross, senior vice president and chief impact officer at the United Way of San Diego County. Welcome to the program.
Thanks for having me.
Are you getting a lot of questions about the new state earned income tax credit the share?
We are. The state has done a really good job and we locally here have focused on getting the word out about the new credit. So we have done, over the years, have been talking about the federal credit and letting folks know note that there are's a local credit.
That woman was certainly extremely happy.
It is estimated about 50,000 tax filers in San Diego County are eligible for the California earned income tax credit. With this conceivably -- adds to the refund that the tax filers would already be getting?
We heard the average is about $900. That is a lot to add to the refund. What kind of local impact you think that would make on San Diego families?
Historically renowned families who are eligible for the income tax credit other federal or state, they are working hard but falling short. They are not able to make ends meet. And when we surveyed them, and we do the survey each year, we hear people were using it for things like paying off debt copying down bills, fixing the car that is the primary mode of transportation to get to and from work. Or even starting a college savings account for the kids.
So it is the kind of things that really does go right back into the economy?
Took about the kind of tax predation -- preparation you offer?
United Way Courtney's 15 partners across the county. We have 75 locations you could come and get your taxes done for free. You can make appointment by calling 211. We provide trained volunteers who are able to do your taxes, make sure you get all of the credits that you are eligible for as well as screening people for other public benefits that they might be eligible for an me know about, things about the cover California, which is still relatively new.
Kind of helped you think -- find -- people generally need 100 taxes?
Texas can be intimidating. We actually have a program where you can find your taxes online yourself. We're seeing great growth and that year-over-year. Last year, we had about 1700 people who did that. This sure we are already over 2000. People are getting more comfortable with that. You want to make sure you do it right. When you come into the site, we are helping people identify the language, with the different categories are.
This year the penalty for not having health insurance goes up a pretty big amount. Be getting a lot of questions about that?
We are. We started to see that Lester and continue to see that the share. That is the first moment that you realize I wasn't paying enough, or had been doing what I was threat here. That shows up when you do your taxes of saying this is the total dollar amount you know all. So we have's and/or to the issue, people have done a better job of being aware of what they should be paying and cover California has done a great job of outreach for that.
Who is eligible to get the free tax assistance from United Way?
We provide taxes to anyone with a sold income under $50,000 a year. In addition, you can go to the website and finally yourself. It's my free taxes.com. That's for households of $62,000 or less. It is an interview base. It walks you through it. You do not have to be a tax expert at all. You just have to click and point. If you do come in you we are not able to help you, we will point you in the right direction.
How often and how long towards the deadline are you going to be having these clinics?
We women throughout the county there is one open every day all the time. Some of our sites are open from 8 AM to's 7 PM. We have one over at the Mission Valley mall. We have one in South County. We are all over the place. We will go through April 18. Text is little extended the share.
I see. Is it on the weekend?
Yes it falls in a federal holiday this year.
If people want to get in touch with you and want to get help online they want to show up to one of your tax preparer and clinics what do they do?
You can call 211 to make an appointment. Can go to our website which is uwsd.org. then if you want to check out and see if you might be able to file your taxes on your own, you can go to my free taxes.com.
I've been speaking with Shaina Gross of the United Way of San Diego County. Thank you very much.