S. E. Williams
Tax season is in full swing and this year California residents are rushing to file for the state’s new Earned Income Tax Credit, CalEITC.
CalEITC is a cash back tax credit that puts money back into the pockets of California’s working families and individuals.
In order to claim the CalEITC (as well as the Federal Earned Income Tax Credit), taxpayers must file both their federal and state returns— even if they owe no taxes.
State and Federal tax experts encourage everyone to file early—this can keep filers from getting caught in the last minute rush and crush that occurs the closer you get to the filing deadline.
There are a number of good reasons to file early. The most obvious—the earlier your file, the sooner you will get your refund. Filing early will not only enable you to get your return sooner. Those who file early often get their returns more quickly.
There is also an advantage to filing early for college students. When applying for Free Application for Federal Student Aid also called FASFSA, the application requires the applicant’s and their parents tax information. The sooner you file the sooner the FSFSA application can be submitted for consideration.
For those who may owe money, filing early also has its advantages. It will give provide clarity regarding how much is owed and enable individuals to better plan how to integrate the payment amount into their budgets.
According to the IRS, one in five taxpayers will wait to file their returns during the last week of tax season. Both state and federal tax agencies encourage everyone to, file early and avoid the stress that usually comes with a last minute rush.
This year, California hopes to see an increase in filings as a result of the CalEITC. California State Controller Betty Yee stated, “We want to encourage taxpayers to take advantage of both the state and federal EITCs.”
The CalEITC is expected to benefit 600,000 California families while the federal EITC will benefit as many as four million families nationwide.
You may qualify for CalEITC if you made less than $6,580 in 2015 and have no dependents or if you have two or more dependents and earned less than $13,870. In addition, you must be a U.S. citizen or resident alien with a valid Social Security Number and have lived in California for six months or more during 2015. You must also be aged between 25 and 65; not be claimed as a dependent on another’s tax return; and, not have investment income greater than $3,400 for the 2015 tax year. Taxpayers who earned less than $53,000 may also qualify for the federal EITC.
CalEITC4Me works to make the filing process as easy as possible for Californians to claim the state’s first ever Earned Income Tax Credit by connecting them to free tax preparation services. For example, if you are eligible for the Earned Income Tax Credit or made $54,000 or less in 2015, you can get your tax return filed for free. For more on how to file for free visit caleitc4me.org/get-it/.
For more information regarding CalEITC and/or to learn how to have your tax return prepared for free visit caleitc4me.org.