South Jersey Times – Senate President Steve Sweeney toured the United Way of Salem County on April 10 and joined with officials of the public service organization and members of the community in a roundtable discussion of the Earned Income Tax Credit, where they encouraged eligible workers to take advantage of the tax break that was increased in New Jersey.
Sweeney sponsored the legislation that increased the benefit of the tax break from 30 percent to 35 percent, starting with the 2016 tax year. United Way of Salem County operates a Volunteer Income Tax Assistance program that provides free income tax preparation for eligible families and individuals and ensures that they receive the full benefit. The NJ EITC is a refundable credit based on the federal EITC and is paid to eligible taxpayers through the state’s gross income tax.
“The increased EITC is a tax cut for those who need it most,” said Sweeney. “It is not fair that working people can’t afford to support themselves and their families with basic necessities. This will put more money in their pockets so they can put food on the table, pay their rent and care for their children.”
The tax benefit was part of a number of cuts enacted last year by the Legislature that included savings for retirement income, veterans, the sales tax and the estate tax.
The tax benefit will help an estimated 600,000 individuals and families in New Jersey, but it is important that they apply for the credit when they file their taxes, said Monique Chadband, the President & CEO of the United Way of Salem County.
“The Earned Income Tax Credit is a tremendous help to our local families who often use the increase to their tax refund to take care of basic necessities,” said Chadband. “It is imperative that people are aware and take advantage of the opportunity, which is why we offer help and assistance to those in the community who qualify. We are grateful to Senator Sweeney for fighting in Trenton to get the EITC increased and we are thankful that he is now helping to raise awareness.”
Based on available federal Internal Revenue Service data the average NJ EITC benefit amount will increase by $255, from $708 in for the 2015 tax year to approximately $963 for the 2016 tax year.
The Earned Income Tax Credit is a refundable tax credit for families and individuals who have earned income from employment. Residents who are eligible and file for a federal earned income credit can also receive a New Jersey earned income credit in the amount equal to 35 percent of their federal earned income credit.
The credit is based on gross earned income, filing status, and the number of qualifying children in the home. To qualify, earned and adjusted gross income must be less than:
$47,955 ($53,505 if married and filing jointly) with three or more qualifying children;
$44,648 ($50,198 if married and filing jointly) with two qualifying children;
$39,296 ($44,846 if married and filing jointly) with one qualifying child;
$14,880 ($20,430 if married and filing jointly) with no qualifying children.
The increased EITC also provides a boost to the economy because the money goes right back into spending, mostly in the local community, said Charles Washington Jr., the mayor of Salem.
“The unemployment rate in Salem County is higher than 10 percent — more than the State of New Jersey, and the national average,” said Mayor Washington. “For families walking a financial tightrope, unable to save for college, a home, or retirement, the Volunteer Income Tax Assistance tax preparation services offered by the United Way is a critical program that supports low-income families and individuals and puts more than $400,000 back to our community.”
The tax assistance offered by United Way of Salem County uses volunteers working to help prepare basic federal and state income tax returns for families with income levels up to $62,000/year. All volunteers are certified through an online course provided by the IRS and have the flexibility to work on tax returns in the UWSC when it’s most convenient for those seeking help. The service is part of the financial stability initiative that helps families and individuals meet basic needs, to find gainful employment, learn money management, and begin saving for their future. All donations and corporate support to expand the United Way of Salem County’s VITA program are welcome.