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IRS designates a day to remember income tax credit

IRS: One in five eligible taxpayers fail to capitalize on $2.2K tax credit

Posted: February 1, 2012 - 1:09am

The Earned Income Tax Credit means a great deal to working families, IRS Director Verlinda Paul said on a teleconference Friday. However, one in five eligible workers fail to claim their credit, she said.

Almost 46,000 Alaskan taxpayers claimed the credit for tax year 2010 returns filed in 2011. The credits totaled $86.6 million with an average credit of $1,890.

Paul admitted to some complexity to determining one’s eligibility. She offered the EITC assessment at www.irs.gov as a tool to help, and also recommended seeking out help from local volunteer tax preparers.

In Juneau a free tax service is provided by the Internal Revenue Service’s Volunteer Income Tax Assistance and Tax Counseling for the Elderly Programs and the Association for the Advancement of Retired Person’s Tax-Aide program.

To contact a tax aide in Juneau email janwatson2000@yahoo.com. Those interested in volunteering can find more information and register at aarp.us/dS7kpd.

Paul also said standard tax-filing software, used by individuals in their homes or by accounting firms can be helpful.

“Most of these services will determine eligibility and compute the amount of the credit,” Paul said.

However, before a taxpayer starts computing anything, there’s one important first step to take.

“Workers must file a tax return to receive the credit,” Paul said. Many of the taxpayers who fail to claim their credit do so by not filing a tax return, she said.

Other people miss out because they do not know they qualify. “Single workers or workers without children often do not know they may qualify,” Paul said.

But there is some good news for those who may have qualified in the past but missed their opportunity. Taxpayers who miss the credit in the past can claim it retroactive for up to three years by filing returns for those years.

• Contact reporter Russell Stigall at 523-2276 or at russell.stigall@juneauempire.com.

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