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Housing programs can maximize workers’ tax refunds

by Maya Brennan, Center for Housing Policy

As the nation’s economic recovery struggles to take hold, many families are counting on maximizing their tax refund, and housing authorities are well-positioned to help. As described in a recent Center for Housing Policy paper, over one million households with earned income live in public housing or have voucher assistance. These families may be eligible for a federal earned income tax credit of up to $5,751 during the 2011 tax year, as well as other federal, state, and local tax benefits. By using their existing relationships with these families, public housing authorities help families find free tax preparation assistance and retain all of the refund money available to them.

The Boston Housing Authority (BHA) is part of a coalition that helps working families access the EITC. They help spread the word about free tax assistance to public housing residents and voucher holders through rent mailings, FSS workers, and property managers – all at minimal cost to BHA. The outcome for families has been tremendous. In 2009, 820 public housing households used the city’s free tax clinics, and these families received a median refund of $1,241 – well over a month’s wages. Best of all, none of the tax refund money was eaten up with fees on refund anticipation loans or other tax preparation costs.

This kind of assistance is has a tremendous payoff for a very small effort. Housing authorities are in regular contact with their residents through income verifications, rent invoices, and other meetings and mailings. It costs next to nothing to include a flyer from a local EITC campaign.

EITC outreach opportunities are not limited to public housing authorities either. Other affordable housing providers have the same sorts of relationships with EITC-eligible families and could collaborate with local EITC campaigns to spread the word. Free tax preparation clinics could also be offered on-site at housing developments to reduce barriers to participation.

In a tough economy, there are few easy ways to get extra cash to pay the bills or contribute to a nest egg. The EITC is one of them. And property managers and housing authorities are well-positioned to help families access it.

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