Nearly $20 million in Refunds to Residents from City’s Earned Income Tax Credit Campaign
(Philadelphia, August 3, 2016) – The number of Philadelphians taking advantage of free tax preparation at City-sponsored sites this year more than tripled over 2015, bringing them nearly $20 million in refunds, according to a report from the Department of Revenue.
The increase comes as a result of an aggressive campaign launched by Mayor Kenney in January to boost participation in the Federal Earned Income Tax Credit program. As part of the campaign, the city offered residents free tax preparation at 15 sites, and 17,000 individuals and families took advantage of that – compared to just 5,000 a year ago.
“We believe the increased participation at the free tax preparation sites shows clearly that Philadelphians are getting the message,” said Revenue Commissioner Frank Breslin. “The EITC isn’t really complicated, but some fear that it is. The free tax preparation sites help dispel that fear and make getting the credit – and refunds — easier.”
While citywide totals for the EITC refunds are not yet available, the 17,000 tax returns prepared at the free City-sponsored sites resulted in $19.3 million in refunds, including $7.5 million of EITC refunds. The IRS is expected to release the total of EITC refunds for the entire city in about 18 months.
“The Earned Income Tax Credit is such a valuable economic benefit that can go a long way for many Philadelphians and for our entire city,” said Councilman-at-large Allan Domb, who helped promote the campaign. “I am encouraged by the progress we have made to get these Federal dollars into the hands of our citizens and ultimately into our local economy. We must continue to champion this effort and collectively focus on increasing participation going forward.”
The Earned Income Tax credit is a federal tax benefit for working individuals and families who have low to moderate income. Around 200,000 Philadelphians are eligible to claim the Earned Income Tax Credit, but around 40,000 have been missing out. The average credit per taxpayer in Philadelphia comes in at more than $2,400, leaving more than $100 million on the table.
To operate the 15 City-sponsored sites offering free tax preparation, the City partnered with the Campaign for Working Families, Pathways PA, and Ceiba.
The EITC awareness campaign included: focus groups to identify barriers to getting the tax credit; ‘street teams’ to visit businesses, hang posters, drop flyers and talk to residents; nearly 70 community meetings; 60,000 postcards mailed to likely-eligible residents; and advertising in newspapers, on radio, online and on SEPTA. The City will be launching the EITC campaign for next tax season in January 2017.