EITC and Veterans

By | March 23, 2015

The EITC and Child Tax Credit expansions and the American Recovery and Reinvestment Act of 2009 made more workers eligible for larger refunds, and they remain in effect for workers in 2012. Together, these credits lifted over nine million people and working families above the poverty line in 2010. About one in four current or former armed-forces families with children or 1.5 million military families, receive either the Earned Income Tax Credit or the low-income component of the Child Tax Credit, two tax credits for low- and moderate-income working families, according to analysis of the census and IRS data.


Veteran Tax Benefits

In about 280,000 of these families, a parent is currently serving in the Armed Forces. In the rest, a parent is a veteran. The 1.5 million families contain about 3 million children under age 18 and received, on average, about $1,000 per household from the low-income portion of the Child Tax Credit in 2011, and $2,650 from the EITC. Studies have found that children whose families receive more income support from the EITC tend to do better in school and are more likely to attend college and to earn more as adults.


Veterans and the Earned Income Credit

Veteran statistics underscore the need for financial-capability strategies and tools in the veteran community. The Department of Veterans Affairs reports that 22.5 million veterans in the United States and more than 37 million veterans, dependents, or survivors are eligible for veteran benefits. According to the Center for American Progress, United States Census Bureau reports that 1.5 million veterans are at risk of homelessness due to poverty. A veteran lives in one in five households that are benefiting from the Low Income Home Energy Assistance Program, which provides heating and cooling assistance.


Can Veterans Claims the EITC?

According to the U.S. census in 2007, of the 23.6 million military veterans in the United States, 6 million had disabilities. Again, you can see that synergy that is coming between National Disability Institute and the Department of Veteran Affairs. In addition, an increasing number of disabled veterans returned from combat in Afghanistan and Iraq with post-traumatic stress disorder, PTSD, as well as traumatic brain injury, TBIs, and other mental and physical disabilities that resulted from their tours of duty.


The IRS Volunteer Income Tax Assistance, VITA

The IRS Volunteer Income Tax Assistance, VITA, and the Tax Counseling for the Elderly, TCE, programs offer free tax help for taxpayers who qualify. The VITA program generally offers free tax help to people who make $52,000 a year or less and need assistance in preparing their own tax returns. IRS-certified volunteers provide free basic income-tax-return preparation with electronic filing to qualified individuals in local communities. They can inform taxpayers about special tax credits for which they may qualify, such as the Earned Income Tax Credit that Katie talked about earlier, Child Tax Credit, and credit for the elderly or the disabled. VITA sites are generally located at community and neighborhood centers such as libraries, schools, shopping malls, or other convenient locations. The TCE program offers free tax help for all with priority assistance to people who are 60 years of age or older. The providers specialize in answering questions about pensions and retirement issues that are unique to seniors. IRS-certified volunteers who provide tax counseling are often retired individuals associated with non-profit organizations that receive grants from the IRS.


IRS FreeFile for Veterans

Free File is a free service that offers free federal tax preparation and e-file options for all taxpayers. Free File is made possible through a public/private partnership between the IRS and commercial tax-software companies. Since 2002, over 30 million taxpayers have taken advantage of this free service, saving over $1 billion in tax-preparation fees in the process. All taxpayers have a Free File option. The traditional, interview-based Free File option is available to 70% of America’s taxpayers. For 2014, that means if you have an adjusted gross income of $58,000 a year or less, you qualify for this service.


Can Veterans Files Their Taxes for Free?

Simply go to the Free File link on IRS.gov and click on “Select a Free File Company.” In addition, all taxpayers may use Free File fillable forms at no additional cost. This is a forms-based program. Once you calculate your line-by-line entries, just complete your return and e-file. It´s just that easy. Let me add that if you´re the type of person who is interested in free online tax-preparation services without going to a VITA site, you have several choices to prepare taxes for free from home, work, or anywhere there´s access to the Internet. Software providers make their products available through public/private partnerships with the IRS. Free federal tax preparation and e-file options are available for all taxpayers. However, each company may set its own limits and income thresholds. Review the choices at freefile.IRS.gov.