From Rappahannock United Way
Fredericksburg, VA – Rappahannock United Way supports making low-moderate-income tax credit refundable in Virginia.
Today (August 17, 2018) the Governor will address the General Assembly joint money committees and will include a proposal to share the windfall Virginia’s state coffers are getting from last year’s federal tax cuts, with hard working Virginians. Northam has said he will ask the General Assembly to make Virginia’s earned income tax credit fully refundable.
Currently, the Earned Income Tax Credit (EITC) is used to reduce or completely offset a taxpayer’s bill — but if that bill is less than the credit, the taxpayer doesn’t get that difference. When it comes to helping working families, the federal earned income tax credit (EITC) is one of the
biggest success stories we have, lifting three million children out of poverty each year. The credit provides extra support to millions of workers and their families, including over 600,000 working households across Virginia. For families struggling to make ends meet, the EITC helps them put food on the table, pay utility bills, and provide opportunities for their children.
Last year Rappahannock United Way helped more than 450 local households last tax season, access the federal EITC putting more than $645,000 back in their pockets and into our local economy – with a refundable state credit this could be so much more.
Right now, low-income working families in Virginia pay more in state and local taxes as a share of their income than high-income Virginians. But, unlike the federal EITC and similar credits available in 24 states, if a family’s Virginia credit is more than the amount of income taxes they owe, they don’t get the full value of the credit.
To bring Virginia’s EITC to its full potential as a tool to help low-income working families, it should be made refundable. We hope that with Governor Northam’s support the state’s low income tax credit will become refundable.
About Rappahannock United Way
Founded in 1939, Rappahannock United Way is a local nonprofit organization serving Fredericksburg, Caroline, King George, Spotsylvania and Stafford. Our mission is to improve lives by mobilizing the caring power of our community. Our goal is to have more households emerge from poverty and achieve greater financial stability. Together, we can create opportunities for a better tomorrow. That’s what it means to LIVE UNITED.