Tax credit helps Utah military and veteran families, analysis shows
An estimated 13,000 Utah families with parents who are veterans or still in the military receive tax credits that help put food on the table, according to a new analysis.
The Center on Budget and Policy Priorities issued the analysis this week amid discussions in Washington about tightening up on the Earned Income Tax Credit (EITC) and Child Tax Credit (CTC) to get more tax revenue.
"It's a concern here in Utah, given the number of people who receive the EITC," said Tracy Gruber, policy analyst for Voices for Utah Children.
About one in four current or former armed forces families with children, or 1.5 million military families, receive one or both of the tax credits, the center said. Of those, 280,000 have at least one parent who is now serving in the armed forces.
For many active-duty and veteran families, these credits make a major difference to their economic security, the center said in a news release about its new analysis.
It's good that the credits help veterans and military personnel who have sacrificed much for the country, but "it's a national tragedy that 25 percent are not earning enough to meet the economic needs of their families," Gruber said.
The EITC and the CTC are "two very effective policies in helping people who are playing by the rules, going to work every day," Gruber said. "It's not a government handout. You don't get it unless you are working and have earned income."
The tax credits go to low- and moderate-income families, and have been championed by conservatives, she noted.
Gruber's organization and others want Utah to adopt its own earned income tax credit; the Utah Senate passed such a bill in 2012 and the Utah House during the last legislative session.
In 2013, a married couple with two children can qualify for the federal EITC if the family makes less than $48,378; it can qualify for the low-income portion of the CTC if it makes less than about $47,000.
The news release said the center analyzed IRS and Census Bureau data to come up with the numbers. IRS data show that, in total, about 25 million families with children received either the EITC or the low-income portion of the CTC in 2010.
Kate Rubalcava of the Community Action Partnership of Utah said that 227 families who sought volunteers' help with their tax returns at Hill Air Force Base last spring qualified for the EITC. Some 527 families at HAFB qualified for the CTC.
CAP Utah houses the Earn It. Keep It. Save It coalition, which provides free tax-return processing at 80 sites around Utah. The coalition's 800 volunteers completed 19,148 returns, an increase of nearly 16 percent.
At HAFB, the average family qualifying for the EITC received $2,267, Rubalcava said.