Earned Income Tax Credits

Need/Problem:
It is estimated that there is more than $50 million dollars in Earned Income Tax Credits not received by those low income families that qualify in Iowa. This is especially problematic in the rural areas of Iowa where free income tax assistance is in short supply.

Response:
Iowa State University Extension, together with Opportunity Works and Operation Threshold, applied for a grant through the Institute for Social and Economic Development to provide low income families with free tax assistance in Butler, Bremer, Buchanan and Grundy Counties. Fifteen (15) individuals volunteered to work on this project and nine (9) volunteers were trained to do income tax assistance.

Impact:
Sixty-seven (67) low income households from seven (7) counties (Black Hawk, Bremer, Butler, Buchanan, Grundy, Marshall and Tama) were served. The average earned income for this group was $9,093. The total amount of federal tax refund received by these households was $100,946 which included $64,667 of Earned Income Tax Credit. The total state refund totaled $9418.

Of the 67 people served, 64 were Caucasian, 2 were Hispanic and one is Native American. Forty-one (41) households had a bank account, and 28 of those responding to the consumer survey did receive some sort of public assistance. Twelve (12) households paid a commercial preparer last year to do their taxes and half of those (6) received an instant refund. Most of the households who responded to the consumer survey (17) were told about this free service by family or a friend, while 28 were clients of this free service last year.

Contact:
Patricia K. Gorman
Field Specialist/Resource Management
Grundy County Extension
703 F Street Suite 1
Grundy Center, IA 50638
Phone 319-824-6979; Fax 319-824-6601
Email pgorman@iastate.edu

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