With less than a month until the April 15 tax filing deadline, Democratic U.S. Sen. Sherrod Brown introduced legislation to provide grants for volunteer assistance sites and to make the funding more permanent.
“As the economy continues to move forward there are a lot of things that Ohioans can do to save themselves and their families money,” Brown said, explaining the reasons for the Volunteer Income Tax Assistance Act of 2013, or VITA Act, Wednesday during a weekly media teleconference. “Every tax cut, every way to save a dollar earned means more groceries, more gas money, more money pumped into the local economy.”
He said more than 32,000 Ohioans did not file a tax return in 2010, leaving $26 million in unclaimed tax refunds on the table, with the median refund totaling $561, more than the typical family of four spends on groceries in a month.
He explained taxpayers have until April 15 to file this year’s tax return and amended tax returns reaching back to 2009 to claim tax credits they were eligible to receive. After that, these credits will be lost — which is one reason Brown introduced the VITA Act.
“The VITA Act is to help more middle class and low income Ohioans claim vital tax credits by offering specialized assistance to low and moderate income individuals who otherwise cannot afford it,” Brown said. “Hardworking Ohioans should not be loaning Uncle Sam money and the VITA Act plays a vital role in informing Americans of tax credits they may be entitled to and help ensure those tax returns are filed in a complete and timely manner.
“This bill would keep those VITA sites operating and ensure Ohioans get the biggest refund possible,” he said. “Filing taxes is complicated enough and saving money you’ve earned should be easy. So my new webpage is informative and user friendly, and VITA sites offer tax help for low-to-moderate income families so they can claim important tax credits.”
He outlined three tax credits low-to-moderate income families can take advantage of including the Child Tax Credit which provides families with $1,000 worth of tax relief for each child under age 17.
The Earned Income Tax Credit (EITC), which is a tax credit favored by both parties, is a federal tax credit available to working individuals, making less than $13,450, or families, making less than $50,000 per year.
For the 2010 tax year, Ohioans lost $2,103 on average. Last year, 942,470 Ohio taxpayers claimed the EITC, returning more than $2 billion into the economy. Ohioans failed to claim approximate $532 million by not taking advantage of the tax credit.
The American Opportunity Tax Credit (AOTC), which was passed as part of the Recovery Act and was extended as a part of the American Taxpayer Relief Act in January, provides a partially-refundable tax credit for college tuition and expenses.
A dollar-for-dollar match is available for the first $2,000 spent on college costs for each child, with the total deduction worth $2,500 or credit worth $1,000. The average credit in Ohio last year was $2,100. In 2010, an estimated 346,500 Ohioans failed to take advantage of this tax credit.
In Auglaize County, 2,105 are enrolled for the credit but 1,300 failed to take advantage of the tax credit.
“Since the benefits of the AOTC are clear for the middle class and for our economy, I hope to increase the number of families in 2013 who can take advantage of it and that is the reason for this call supporting the VITA,” said Brown, who also launched a web site to alert Ohioans of tax credits and tax help. “My hope is to alert every Ohioan to free tax preparation services and critical, but often unclaimed, tax credits.”