City residents encouraged to seek tax credit

Sixteen sites in Providence help low-income families file for the Earned Income Tax Credits.

Monday, February 7, 2005, BY KAREN A. DAVIS, Journal Staff Writer

PROVIDENCE -- City leaders are joining a community coalition in urging low-income residents to take advantage of more than $10 million in untapped tax benefits by filing for Earned Income Tax Credits.

Mayor David N. Cicilline is also working with community agencies to encourage residents to have their income tax forms processed at Volunteer Income Tax Assistance sites. The first site opened Thursday.

"After the 2002 tax season, an estimated $27 million in Earned Income Tax Credit benefits was left unclaimed by Rhode Islanders, $10 million of which was in Providence," Cicilline said in a statement. "This was real cash available for medical and heating bills, groceries, rent and mortgage . . . left off the table either become residents didn't know about the Earned Income Tax Credit or didn't know how to go about applying for it." Cicilline said he and the coalition are taking "a very active role" to make sure that the money does not go unclaimed this year. Awareness campaigns are being launched in other cities as part of a pledge by the U.S. Conference of Mayors.

The city is working with the United Way, Providence Asset Building Coalition, Rhode Island ACORN and other groups to remind residents of the tax credit and to promote the 38 sites around the state. Sixteen are in Providence.

The city joined forces with United Way of Rhode Island and the Internal Revenue Service to raise awareness of the decades-old tax credit program in November to boost the income of the poorest working families.

The city has sent letters to city employees, colleges and universities, utility companies, businesses and other Rhode Island mayors as part of the campaign.

Officials estimate that, in addition to boosting tax returns, the money could add an estimated $2.5 million to the local economy.

IRS officials noted that it could yield as much as $4,300 extra on the tax return of a low-income family.

A two-parent family that earns $18,000 a year could receive a $4,300 tax credit, the IRS said.

The mayor noted that between 80 to 85 percent of eligible tax payers in the city take advantage of the benefit.

Richard Keller, program coordinator of the Providence Asset Building Coalition, emphasized the importance of a free tax service for working families. Last year, the Providence Asset Builing Coalition operated seven sites and helped low-income families reap thousands of dollars in Earned Income Tax Credits.

Keller said the sites also saved families an average of $250 each in commercial tax preparation fees and interest charges.

"We are especially excited to be part of this initiative," said Zenaida Martinez, chairperson of the Rhode Island ACORN board. "Last year, I spent nearly $500 in fees and interest to get my taxes done. This year I have been trained by the IRS to do my own taxes and help fellow working mothers like myself prepare their taxes, take advantage of the credits and keep every penny of their return."

ACORN will also help raise awareness about the tax credits by canvassing door-to-door in low- and moderate-income neighborhoods.

People who want to volunteer at the tax sites should call (401) 421-1040.

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