Latinos are an important asset to our economy.
With an increasing population growth and expanding share of the U.S. workforce, U.S. Latino economic output would be ranked as the 5th biggest economy in the world stage. As such, the wellbeing of this country is deeply connected to how Latinos can continue to contribute and benefit from our economy. Our tax system offers an opportunity to ensure that Latino taxpayers receive benefits that they are eligible for. Programs like the Earned Income Tax Credit (EITC) and the Child Tax Credit (CTC) are some of the best tools that the federal government has to invest back into low-income and hardworking Latino families.
The EITC has been around since the mid-1970s, and since then the program has supported workers by reducing the tax burden and supplementing their wages through a refund. Eligible taxpayers can receive a refund when they claim the EITC, even if they have no filing requirement, owe no tax, and had no income tax withheld. Similarly, the CTC works as a partially refundable credit that taxpayers with dependent children can claim when filing taxes.
Many Latino families regularly claim these credits every year, however not all eligible families do. In particular, mixed status families face significant barriers in accessing these credits due to tax ID restrictions and confusion around eligibility rules. For example, some Latino families might need to apply for an Individual Taxpayer Identification Number (ITIN) to complete this process and without the proper guidance they might be leaving a large amount of money on the table. This toolkit offers resources to share important information with your community members about benefits offered through our tax system.