Search Extension:
The start of a new year means the start of tax return filing time. An important credit for low-to-moderate income households is the Earned Income Credit. This credit can means many extra dollars for paying down debt, paying higher energy bills because of cold weather or even putting money aside in a ‘rainy day’ fund for later use. The 2010 income ranges for Earned Income Credit eligibility are as follows:
| Single worker income level | Married workers income level | |
|---|---|---|
One child |
$36,052 or less |
$41,132 or less |
Two children |
$40,964 or less |
$46,044 or less |
Three children |
$43,998 or less |
$49,078 or less |
| No children | $13,660 | $18,740 |
In addition, the Child Tax Credit is worth up to $1,000 per qualifying child.
Tax filers are reminded to avoid expensive Refund Anticipation Loans (RAL’s). Paid tax preparation service ads tempt by saying the refund can be received in just a day or two, or even on the spot. The short term loan fees for RAL’s typically range from $30 to 130, which can translate into a annual percentage rate (APR) of 50% or much higher! Save your hard earned money by using a free tax filing service or saying 'No!" to a RAL. Tax returns electronically filed with refunds directly deposited into a bank account usually are received within 2 weeks or less - and you get the whole refund!
Free volunteer income tax assistance (VITA) sites open in late January or early February. Nationwide costs for using a paid preparer are estimated to be from $55 to $130 or more (Center on Budget and Policy Priorities). A household using VITA can save their hard earned money to buy groceries or gas by filing taxes for free. These sites can be located by calling United Way 2-1-1 (cell phone: 1-651-291-0211 in the metro area or 1-800-543-7709 in greater MN).
These locations can also be located online through www.irs.gov or www.mdor.state.mn.us. These websites will also be a great source of other information on a full range of credits and deductions you may quality for plus other free filing opportunities available online.
© 2011 Regents of the University of Minnesota. All rights reserved.
The University of Minnesota is an equal opportunity educator and employer.
