DURHAM, N.C. — Though about eight in 10 qualified North Carolina taxpayers receive the Earned Income Tax Credit, at least $135 million goes unclaimed every year, says EITC Carolinas.
State and local leaders are launching outreach efforts and free tax-preparation services to help taxpayers avoid the same mistake this year.
The tax credit, a federal measure aimed at low-to-moderate-income working families, lifts 5 million Americans above the poverty line each year. It also helps stimulate the economy by injecting money back into communities.
More than two in 10 North Carolina taxpayers and their families benefited from the federal tax credit in the 2005 tax year, receiving a total of $1.5 billion.
Families earning up to $41,646 qualify for the credit, depending on their filing status and number of children.
Even workers who were laid off in 2008 as a result of the economic crisis are eligible, as long as they earned income that year.
This year, state taxpayers also can claim a state version of the tax credit, which was approved by the General Assembly in 2007 and is worth 3.5 percent of the federal credit.
Eligibility requirements for the federal and state tax credit are the same.
Combined, the credits can amount to about $5,000 for families with two or more children.
EITC Carolinas is an initiative of MDC Inc., a Chapel Hill nonprofit established in 1967 to expand economic opportunities in North Carolina.