To the editor:

Families who make less than $35,000 may be paying too much tax!
There is tax help available for Minnesotaís low-to moderate-income families. Many people do not realize that they are eligible for tax credits that are automatically taken from their paycheck. The federal Earned Income Tax Credit (EITC) and the state Working Family Credit (WFC) are programs that assist families by offsetting the burden of payroll taxes. They are necessary because many families sacrifice a large percent of their income to Social Security and Medicare while not earning enough to benefit from deductions available to higher-income taxpayers.

Workers who are eligible for the EITC and WFC in tax year 2004 are those with one child and a family income less than $31,338, those with two or more children and a family income less than $35,450, and those with no children who are between ages 25-64 and earned less than $12,490. In addition, most families are unaware that they may be able to file three years back for unclaimed tax credits.
The benefits of these tax programs are long lasting. For example, the Childrenís Defense Fund (CDF) estimates that the credits can turn earnings of a $6/hr. job to $8/hr. wage and earning $9,893 after withholding payroll taxes could receive another $5,365 to help feed, clothe, and care for her children. Clearly this credit is an important investment in Minnesotaís children. In addition, because the money from the credits is often spent locally on basic needs, the credit fuels community economic development and growth. According to estimates by the CDF, if 10% more families who were eligible had claimed EITC and WFC for the 2004 tax year, Minnesotans would have claimed $37.7 million in federal and state funds that would have potentially generated an additional $60.3 million for Minnesota communities.

Sadly, many individuals are unaware that they qualify to claim these tax credits which have the potential to help lift millions of families from poverty. For help to find out if you are eligible, visit www.coveringallfamilies.org or call for free advice from a tax advocate with the Minnesota Department of Revenue (651) 296-0992, the Internal Revenue Service (877) 777-4778 or the Legal Aid Society of Minneapolis (612) 334-5970.

Theresa Dolezal
Cambridge

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