The CARES Act provided some financial relief to Americans impacted by COVID-19 in the form of Economic Impact Payments. However, millions of Americans entitled to EIPs have yet to receive them. Numerous resources have been established to help guide direct service and community organizations in providing information and guidance to those who need it, including:…
A new report lays out the findings from research conducted by Prosperity Now, the Social Policy Institute at Washington University and SaverLife (formerly EARN) on the behaviors and outcomes related to savings and the financial-wellbeing of LMI tax filers. Key takeaways from this research include: Low-and-moderate income tax filers are saving at higher rates than…
Last Spring, Propublica reported that the IRS audits low-income taxpayers at approximately the same rate as it audits the wealthiest 1 percent of taxpayers. A follow-up article notes that the agency cites inadequate funding as the barrier to enacting changes. According to the article, steady cuts have left the IRS’ current enforcement budget 25 percent…
Last week, following the House’s passage of the legislation in April, the Senate passed the Taxpayer First Act of 2019, which includes language to permanently authorize the VITA (Volunteer Income Tax Assistance) program and to allow up to $30 million in funding. After 50 years in practice, VITA will be codified, offering providers and the…
A December article from ProPublica takes a closer look at IRS audit rates by income. While higher-income taxpayers are still more likely to be audited, under pressure from Congress, the IRS has kept the audit rate of EITC recipients relatively high due to concerns about overpayment. The consistent budget cuts at the IRS, reports ProPublica,…
When asked how tax filers at Georgia VITA sites planned to use the EITC or had used the credit in years past, four out of five respondents talked about using the credit for basic necessities, such as paying for food and household bills. And almost half of respondents discussed making investments in future economic mobility,…
It’s tax season and many households are waiting on their tax refund to pay down debt or for spending on necessities. A recent report from the JPMorgan Chase Institute investigates how tax refunds, as a specific cash infusion, impact the timing of out-of-pocket healthcare spending. Drawing on the JPMC Institute Healthcare Out-of-Pocket Spending Panel data set,…
The Common Cents Lab within the Center for Advanced Hindsight at Duke University has released a new guide for VITA practitioners aimed at improving VITA-related outcomes by recommending interventions based on behavioral science. The Lab, which studies financial decision making, designed the guide to build on existing best practices. It outlines a series of solutions…
The Tax Policy Center’s new report on income volatility finds that the majority of working age adults live in households in which income during at least one month per year will fluctuate significantly (at least 25 percent above or below average monthly income). The percentage of low-income, working-age adults who experience this fluctuation is especially high…
The State of California’s Franchise Tax Board (FTB) recently released a report on the impact of the state’s earned income tax credit (CalEITC). Using data from Tax Year 2015, the FTB found that the CalEITC benefitted approximately 815,000 Californians and together with the federal credit, helped lift approximately 250,000 Californians out of deep poverty. The report…