Earned income tax credit for Wisconsinites
For the City Times
WISCONSIN – The federal Earned Income Tax Credit (EITC) program was expanded for the 2021 tax year only. For the first time, workers without children had income qualifications expanded, which made more workers eligible. The maximum credit was nearly tripled for these taxpayers.
The federal EITC credit was enacted in 1975 and quickly became one of the largest anti-poverty programs in America. In 2020 the EITC benefited approximately 349,000 Wisconsin residents who received over $787 million dollars in refunds. This averaged out to $2,254 for each household in Wisconsin that claimed the EITC.
This is one of the most effective anti-poverty tools available to American households. For the 2020 tax year, 16.8% of eligible Wisconsin Households did not claim the credit. This is money Wisconsinites were due and could help boost our local economies. This loss was close to $49 million dollars that was not claimed and used in our local economy.
Another change for the 2021 tax year allows individuals to figure the federal EITC using their 2019 earned income. This change came about due to the COVID-19 pandemic decreased taxpayers’ earned income in 2020 and 2021. To qualify for the EITC, people must have earned income. Workers who received unemployment income in these two tax years saw a decrease in their earned income which affected the calculation of their credit.
We often hear about the federal Earned Income Tax Credit, but taxpayers should be aware this credit exists on a state level as well. Wisconsin Earned Income Credit is a special tax benefit for certain working families with at least one qualifying child and is refundable. This means even workers who did not earn enough wages to have Wisconsin taxes withheld can receive the credit.
Throughout the COVID-19 pandemic, CAP Services’ VITA program continued to serve clients who qualified for our free tax assistance program. CAP files tax returns free of charge for low to moderate-income taxpayers. We are here to help and don’t want you to miss out on this valuable benefit!
To find out if you are eligible for our program and to schedule a telephone interview appointment for your Federal and State filing, please call 1-800-660-5430 if you reside in Waupaca, Waushara, Green Lake, or Marquette County and United Way’s 211 for appointments in Portage County.
CAP Services’ VITA Program is a United Way of Portage County funded program.
CAP Services, Inc. is a private, nonprofit community action agency that has been advancing social and economic justice for people and communities in Marquette, Outagamie, Portage, Waupaca and Waushara counties since 1966.