The Star-Ledger

IRS Owes Money To Low-Income Taxpayers

The Star-Ledger — Friday, February 1, 2008

Star-Ledger Staff

Billions of dollars in free money slips through the fingers of working poor taxpayers each year, and the IRS is trying to do something about it.

Workers who eamed less than $39,783 in 2007 may be eligible for the earned-income tax credit, which has long been viewed as one of the nation's bedrock anti-poverty programs. The IRS and community groups are providing free advice to help people qualify for credits ranging from $428 for singles, to $4,716 for married couples with two or more children.

More than 7 million Americans left more than $10 billion on the table last year because they neglected to claim this credit on their tax retum, an IRS official said during a telephone news conference yesterday. Last year, 470,963 Jerseyans received credits, totaling $880 million.

The IRS will provide free assistance at its offices in Newark, Paterson, Trenton and Cherry Hill on three Saturdays – Feb. 2, 9 and 16 – from 8:30 am. to 12:30 p.m. Income-eligible taxpayers can file online for free at, and get their credit in 10 days. More information is available at (800) 906-9887.

At three Newark locations, consumer advocacy group New Jersey Citizen Action is offering free taxpreparation help that will allow taxpayers to get their cash in two days. Taxpayers can walk in or make an appointment. Information is available at (888) 829-3711.

Last year, Citizen Action provided free tax-preparation service to 1,223 people, who received $1.5 million in tax refunds, including $650,000 from the tax credit.

"Each year, millions of taxpayers receive billions of dollars in these credits because they are low income and they are working – the whole idea is to reward folks for working," said David Williams, IRS director for refundable credits. Last year, the tax credit dispensed $47.7 billion to 22.4 million taxpayers nationwide.

Williams stressed eligibility is tied to income. Taxpayers don't need to be married or have children to qualify. Individuals whose nieces, nephews and grandchildren live with them can be eligible.

Although the program has been around since 1975, many low-income taxpayers fall through the cracks and don't get the money that's legally theirs, said Debra Holland, IRS director for the earned-income credit.

"It's just plain old lack of awareness," Holland said, adding the IRS is targeting the Spanish-speaking community.

"We know the IRS is not as good and credible a source for some immigrant groups, so we go to community groups to help get the word out," Williams said.

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