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Their Stories: Real-life Impact of Tax Credits on Utah Families

19 October 2015
Greg McDonald helping a client with free tax preparation Greg McDonald helping a client with free tax preparation

It's hard to believe, but tax season is just a few months away! One of our dedicated staff members, Greg McDonald, has been preparing taxes for hard-working Utahns for over a decade; first as a volunteer and then as one of the staff at CAP Utah. Greg was recently asked to submit some stories of the families he serves to one of our amazing partners, United Way of Salt Lake, as a part of a collaborative campaign that we are a part of along with United Way and Voices for Utah Children, as well as other local stakeholders to bring awareness to the value of the Earned Income Tax Credit and Child Tax Credit in bringing Utah families out of poverty. To learn more about why these credits are at risk, visit www.utahfamilytaxcredits.org

One of the VITA (Volunteer Income Tax Assistance) goals is to serve clients eligible for EITC – Earned Income Tax Credit. Over 50% of returns completed in February have EITC as part of the client’s refund. For families it can be savings program, a catch-up on bills time, part of their budget process and usually all three. Numerous studies show the power of EITC to pull families above the poverty level, just Google EITC.

The first time I experienced the impact of EITC on a family was more than 10 years ago. He was a janitor with one of or school districts and she, wanting to be home with their two sons, worked as a lunch lady for the same district. Income wasn’t more than $30,000 and during the tax return we were talking about the boys, and how tough it was to stay home and live on their salaries, which is a common conversation at our tax sites. When I completed the return I turned and said your refund is $4,000 dollars and began to explain the next steps and they both burst into tears. They had always completed their own returns and didn’t know about EITC. I amended 3 years of returns providing larger refunds for each year. Their boys are at least 25 years old now and I continued to serve this family for about 3 years.

A more recent client had come in during our off-season tax sessions. The client was recently divorced, had 2 young boys and had lost everything but her car. She and her husband were very well off until some business problems. She was working at a library and was just hoping to get a refund of the federal taxes she had paid. She had lost her house and was behind in rent at the new place. Her family’s past income was well above limits for Child Tax Credit (CTC) and EITC so she had never heard of them. When I told her the refund amount she began to shake. She said it was the first good thing to happen in quite a while. She had a rough two years and now she was able to catch up on bills and get ahead on car maintenance.

Most of my volunteers with a couple of years of tax work have a story or two like these. Our clients are thankful they can a return completed for free and are thankful that by working they get a bit more than a small refund at tax time with EITC.

Greg McDonald - Regional Coordinator, Earn it. Keep it. Save it.