Taxes and Neighbors
Yawn--I think just lost about 50% of my potential readers with that title.At least now I know that those of you still choosing to read are committed.
Over the last year, a couple of different grants have given us the opportunity to dig into research on economic development. If we can play a part in neighboring families becoming more financially stable, those families are more likely to remain in the neighborhood. And a neighborhood with less turnover has higher civic engagement, higher reported life satisfaction, higher rate of high school graduation (and thereby higher earnings)--even lower teen pregnancy rates.
Financial stability begets community stability.
To make up for the boring blog title, I want to share something exciting to share from our research. Today is a special holiday!
January 27th is Earned Income Tax Credit Awareness Day! Yay!
Ok so maybe you won't be carving a turkey for this one, but in my opinion, the EITC is still something to celebrate. Let me explain...
This is Texas and if there are two things we love in Texas (besides barbecue) they're family and hard work. The EITC is designed to promote exactly these two things. With the exception of folks with a few certain disabilities, taxpayers must work to get the credit. Also, a greater credit is available for larger families--an acknowledgment that more dependents mean a higher cost of living. In 2016, 2.6 million working poor Texans received $2,749 on average when they filed their income tax. That means Texans brought $7.1 billion back into Texas pockets by using this credit. Plus, if you're not a fan of welfare, studies show that the EITC encourages large numbers of single parents to leave welfare for work. Lastly, research indicates that families mostly use the tax boost to pay for necessities, repair homes, maintain vehicles that are needed to commute to work, and in some cases, obtain additional education or training to boost their employability and earning power.
Although the incentives are plenty, many people who qualify don't know about the EITC. So it is also something to make sure our neighbors hear about. In fact, estimates report that up to 20% of working taxpayers who qualify for the credit do not claim it.
So there you go. You've successfully celebrated Earned Income Tax Credit Awareness Day and (to stick with the Texas theme) learned something ta' boot!