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Tax credit for poor gives some a boost

Coalition urges taxpayers to file for earned income credit

Arlene Carr, shown with sons Malik and Marcus, was laid off in the fall. The money from the earned income tax credit should help her out.

Essdras M Suarez/Globe Staff

Arlene Carr, shown with sons Malik and Marcus, was laid off in the fall. The money from the earned income tax credit should help her out.

A coalition of businesses, nonprofits, and local government is reminding lower-income families to file for the earned income tax credit, a federal program that can mean thousands of dollars in tax refunds to them.

Although the credit was signed into law by President Richard Nixon in 1975, many lower-income families are either unaware of the credit, or don’t file for it. Depending on annual income and number of children, families that qualify for the credit can receive nearly $7,000 back from the government.

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“It just doesn’t happen if you don’t file your taxes,” said John Drew, chief executive of ABCD, an antipoverty agency serving Boston. “People work very hard, but don’t make a lot of money. This is a wonderful way to even out the playing field.”

The purpose of the earned income tax credit is to give money to working people who still cannot make ends meet.Eligibility is determined by income and the number of children in the family.

Susan Kooperstein, ABCD spokeswoman, said the earned income tax credit can have a big impact on the lives of the poor. She recalled a homeless woman, helped by her agency, who used the money she received from the credit to put a deposit on an apartment.

“It turned her life around,” Kooperstein said.

Arlene Carr, 48, of Dorchester, was laid off from her job as a cashier at Hudson News in September. Still unemployed, she has struggled to make ends meet for her and her two teenage children, relying on food stamps and cutting expenses wherever she could.

“It’s depressing for me, and it’s more frustrating for the kids,” said Carr.

But, Carr, who earned just $19,000 last year, applied for the earned income tax credit when she filed her taxes. As a result, she said, she will receive $6,835, which will allow her to catch up on bills and buy her children some new clothes.

“They’ve been wearing one pair of sneakers for six months already,” she said, “so they’re going to be happy.”

Many advocates, lawmakers, and policy specialists consider the earned income tax credit as one of the most effective antipoverty programs. It lifted some 6.5 million people above the poverty line in 2012, according to the US Census Bureau.

IRS New England manager Elizabeth Skiba, speaking at a recent event to promote the earned income tax credit, said its benefits can extend beyond a single tax year, not only helping families economically, but also emotionally and psychologically because it relieve some of the financial stress.

“It increases academic achievement in children,” she said, “because it increases economic stability of the household.”

In Massachusetts, more than 400,000 people received the earned income tax credit last year, putting $798 million into the pockets of local residents, according to Mayor Martin J. Walsh’s office. “Generally the people who are going to get the tax return, they don’t have the means for saving,” Walsh said in an interview. “They need it to buy food, they need it to heat their house, and they need to pay their rent. It goes right back into the economy.”

The Walsh administration and the coalition opened 24 tax centers in every neighborhood of Boston to help low-incomes families prepare taxes, determine if they are eligible for the earned income tax credit, and, if they are, file for it.

Frank Olito can be reached at frank.olito@globe.com.
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