The Department of Housing and Urban Development and the Internal Revenue Service have agreed to work together to help low-income working families save money on their annual income taxes.
The landmark agreement will emphasize greater coordination between the agencies, expand information sharing and build on existing services. The partnership will work to encourage community-based collaboration to educate and assist low-income families.
More specifically, the partnership aims to:
- Assist low-income, disabled, elderly and limited-English-proficient people in meeting their tax obligations by providing educational outreach.
- Help low-income, disabled, elderly and limited-English-proficient people and families in free tax preparation and free electronic filing of federal tax returns.
- Provide and disseminate information on Earned Income Tax Credits, childcare tax credits and individual development accounts to eligible low- and moderate-income families, and
- Educate the public on how tax credits can be used to build assets.
HUD will notify all its grantees and encourage them to assist the IRS with its outreach efforts and to educate taxpayers about free tax assistance sites, especially those dealing with the underutilized Earned Income Tax Credit.
Last year, 21 million families with two or more children qualified for the Earned Income Tax Credit, providing refunds of up to $4,300. IRS studies indicate millions more families are eligible for this tax credit but fail to claim it.
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