ATLANTA — Internal Revenue Service officials say 1 in 4 eligible American taxpayers are not taking advantage of the Earned Income Tax Credit.

Last year, the credit amounted to about a $2,300 refund for eligible Georgia families, said Neal Wolin, deputy secretary of the U.S. Treasury.

With 17 percent of Hall County families living below the poverty level, according to Census data, that money could go a long way.
The EITC is for workers who typically have children and earn lower incomes.

According to IRS officials, the credit can either reduce tax liability or increase a tax refund.

U.S. Rep. John Lewis, D-Atlanta, chairman of the House Ways and Means Committee’s Subcommittee on Oversight, was on hand Friday to discuss the importance of eligible Americans taking advantage of the credit during a National EITC Day event. Lewis’ subcommittee is charged with overseeing the IRS and the U.S. Treasury Department, among other things.

“In these difficult times, people are struggling to get by. People are losing their jobs and their homes and are struggling to put food on the table,” Lewis said. “The (EITC) can help make a difference in the lives of many of our citizens.”

The purpose of Friday’s event was to raise awareness about the credit and encourage more qualified taxpayers to take advantage of the credit.

“The (EITC) is one of the most important tax credits available for working Americans. Because of this credit, millions of people have been lifted out of poverty — and that includes 3 million children,” Wolin said.

Although the credit has been around for many years, thanks to a congressional vote related to the American Recovery and Reinvestment Act, the umbrella of eligibility has broadened to include more Americans for the 2009 and 2010 tax return seasons.

“The (expansion of the credit) represents an important part of the stimulus package, putting money in the hands of more Americans so that they can put food on the table, or add to a down payment on a house,” Wolin said.

In order to qualify for the EITC for the 2009 tax season, filers with three or more qualifying children must have an income below $43,279 for single filers or $48,279 for joint filers. Filers with two qualifying children must have an income below $40,295 for single filers or $45,295 for joint filers.

Individuals with one or no children may also qualify for the credit, depending on income levels.

“This credit isn’t limited to families or wage earners,” said Steve Miller, IRS deputy commissioner of services and enforcement.

“As many people as this credit helps, it’s not helping everyone that is eligible. This credit isn’t automatic; you do have to file a return.”

Over the years, various life events — marriage, divorce, changing jobs — can lead to a person falling in and out of eligibility for the EITC, Miller said.

Depending on income and family size, the credit could range from $457 to $5,657.

To help taxpayers keep more of their money, the IRS has posted a link to free tax preparation services. The programs allow taxpayers to e-file their returns for free and to also take advantage of direct deposit, which IRS officials say is the faster way to receive a tax refund, compared to mailing a paper return.