Millions in earned-income credits still available to thousands of taxpayers TTC

April 10, 1994|By From Staff Reports

For once, the Internal Revenue Service has good news, with just five days left to meet the April 15 filing deadline.

An estimated 300,000 Maryland families qualify for the earned-income tax credit this year, a program that gives working-poor families credits of up to $2,364 on federal returns and $1,182 on state returns.

But U.S. Rep. Benjamin L. Cardin said yesterday that as many as 40,000 eligible households in Maryland may not know about the program. As a result, up to $40 million in tax credits could be sacrificed.

"It is not too late in the tax season to take advantage of the earned income credit," Mr. Cardin, a Baltimore Democrat, said at a news conference at the downtown office of the Maryland Committee for Children. "If you have not filed, you can still do so. If you have already filed, you can do an amended return."

Anyone whose income for the year was less than $23,760 and who had at least one child living at home last year qualifies to file for the credit, which reduces the amount of income tax due.

"Both married and single parents qualify," said Paul M. Harrington, the IRS' Baltimore district director. "If you owe federal tax, the [credit] will reduce the amount you owe. If you don't owe federal tax, the government will send you a check in the amount of your benefit."

Maryland Comptroller Louis L. Goldstein said more than 94,000 families have claimed their state credits for the 1993 tax year. But he reminded taxpayers that there are differences between the federal and state program, although they use the same standard of eligibility.

In Maryland, a taxpayer can claim 50 percent of the credit claimed on the federal return. Many taxpayers make the mistake of claiming 100 percent on their state returns, Mr. Goldstein said, which slows processing refunds.

Maryland also has a benefit for taxpayers whose federal adjusted gross income is less than the poverty level. The state tax book contains a work sheet to help taxpayers determine whether they qualify.

To file for the earned income tax credit, Form W-5 is required. For more information, call the IRS at (800) 829-3676.

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