State Treasurer John Kennedy wants to remind working families in Louisiana that it is not too late to take advantage of an important and often overlooked federal tax break known as the Earned Income Tax Credit (EITC).”People are struggling, and in today’s economy, every little bit helps,” said Treasurer Kennedy. “If you haven’t filed your taxes yet, take a few minutes to see if you qualify. There is still money out there that’s being left on the table. Everyone who qualifies for this federal tax break should take advantage of it.”
According to The Brookings Institute, Louisiana residents claim an estimated $1 billion in federal Earned Income Tax Credits each year. However, Louisiana families miss out on approximately $100 million in additional unclaimed Earned Income Tax Credits annually.
The federal EITC provides low and moderate-income working individuals and families with a rebate of all or a portion of the federal income taxes they pay each year. In order to be eligible for the credit, an individual must have a job and must file a tax return. The federal credit is refundable, meaning that filers can claim the full amount even if it exceeds what they owe in taxes for the year.
For the 2008 tax year, Louisiana residents can also claim a state earned income credit which amounts to 3.5 percent of the federal EITC. Tax filers who are eligible to claim the federal EITC are automatically eligible for the state credit. The state earned income credit can result in an additional refund of up to $168 for Louisiana EITC recipients.
According to the IRS, you may claim the federal EITC in 2008 if your Adjusted Gross Income was less than:
– $38,646 ($41,646 married filing jointly) with two or more qualifying children;
– $33,995 ($36,995 married filing jointly) with one qualifying child;
– $12,880 ($15,880 married filing jointly) with no qualifying children.
The maximum federal EITC for the 2008 tax year is:
– $4,824 with two or more qualifying children;
– $2,917 with one qualifying child;
– $438 with no qualifying children.
For more information about the federal EITC, visit the Internal Revenue Service’s Web site at www.irs.gov or call (800) 829-1040. For information on the state earned income credit, visit the Louisiana Department of Revenue’s Web site at www.revenue.louisiana.gov or call (225) 219-0102 or (225) 219-2200.