News for Hoosiers...

In January, Senator Lugar partnered with the United Way of Allen County and the Volunteer Center @ RSVP in January to promote the Earned Income Tax Credit (EITC).  Free Tax preparation services were available on Thursday, January 31 at Senator Lugar’s Northeast Indiana Community Service Center in recognition of National EITC Awareness Day.

“This is money that hard-working Hoosiers have already earned and deserve back from the government,” Senator Lugar said.  “I am hopeful that together we can encourage taxpayers to take advantage of the free local tax preparation.”

Volunteer John Wunderlich prepares tax returns for qualifying Hoosiers in Senator Lugar's Northeast Indiana Community Service Center.

The EITC is a refundable tax credit available to families with a working member where the income falls below $40,000.

Nationally, the IRS estimates that between 20 and 25 percent of qualified Americans do not claim the EITC. In Indiana, the IRS estimates that 15 percent or more of qualifying Hoosiers do not apply for the EITC.

According to the IRS, more than 441,000 Hoosiers claimed the federal EITC in 2006 for refunds totaling $831 million.  This increase of 2.8 percent from 2005 included an additional 12,348 Hoosiers.

Enacted by Congress in 1975, EITC was designed to decrease the tax burden and supplement wages, as well as provide incentive to work. When the EITC exceeds the amount of taxes owed, it results in a tax credit for those taxpayers who qualify and claim the credit.

In addition, taxpayers who qualify can retroactively claim an additional three years of the EITC, as long as they file their taxes before April 17. This is money that hard working Hoosiers already have earned and can save or put back into the economy.

For assistance in determining eligibility, taxpayers may use the EITC Assistant, a web-based tool, available at http://www.irs.gov. By providing basic information, this program assists taxpayers with filing status, determining eligibility and estimating the amount of credit you may receive. In addition, the IRS has Volunteer Income Tax Assistance (VITA) centers available throughout the state to provide free assistance with tax preparation. For a center located near you, call Senator Lugar’s Indianapolis office at (317) 226-5555. Taxpayers may request a free copy of Publication 596 Earned Income Credit by calling the IRS at 1-800-829-3676.

In Allen County, free tax preparation services are available from January 26 to April 12 by calling 211.  Interpretive services can be arranged for taxpayers.  Among the languages offered are Spanish, Russian, French, Arabic, and Karan Burmese.

Partners of the community effort in Allen County include:  Internal Revenue Service, Community Action of Northeast Indiana (CANI), City of Fort Wayne, Fifth Third Bank, Purdue University Cooperative Extension Service, American Red Cross-Multicultural Exchange (MIX), National City Bank and the Euell A. Wilson Center.

In the U.S. Senate, Senator Lugar has consistently supported additional funding to expand the services provided by the community Volunteer Income Tax Assistance (VITA) program.  The fiscal year 2008 funding bill included $8 million for the VITA program to provide taxpayer services, including pre-filing assistance and education, filing and account services and taxpayer advocacy services.

For more information on the EITC and eligibility requirements, please visit http://lugar.senate.gov/eitc/.