The latest statistics last week from the Census Bureau are grim. Household income has fallen sharply; poverty is up. And that's based on data from a year ago, when employment was in better shape.
Even more so now, every penny counts. So is there any way to get extra money in your paycheck without asking the boss for a raise?
One way is to get an advance on the Earned Income Tax Credit, a credit worth thousands of dollars to lower-income workers. Usually, people claim the credit on their tax returns. But if you have kids you can claim part of the credit - as much as $1,826 this year - in advance and get the money paid out over time through your paycheck.
It won't make you rich, but for some it could be worth an extra $30 or $40 in a paycheck that could help with child care costs or car insurance premiums, says John Wancheck, earned income credit campaign coordinator with the Center on Budget and Policy Priorities.
To get an advance, you have to qualify for the credit in the first place. And even then, only under certain conditions can you get the credit early.
Start by filling out Form W-5, the Earned Income Credit Advance Payment Certificate. This form is available on the IRS' Web site at www.irs.gov or by calling the agency at 800-829-3676. Your employer may also have the forms.
The W-5 asks several questions to see if you are eligible for the credit, which was temporarily expanded under the federal stimulus package this year.
Eligibility is based on income. If you don't have children, you can get a full or partial credit if your adjusted gross income is less than $13,440 if single and $18,440 if married filing jointly. On the high end, you are eligible for a credit if you have three or more kids and your income is under $43,279 if single and $48,279 if filing jointly.
The size of the credit is tied to the number of children you have. The maximum credit ranges from $457 for taxpayers with no children to $5,657 for those with three or more kids. A qualifying child must live with you for more than half the year and be under age 19, or under 24 if a full-time student. No age limit applies if a child has a permanent disability.
Once you know whether you qualify for the credit, you have to pass certain other tests to get the advance.
Advances are only for taxpayers with children. Childless singles who qualify for the credit must wait until they file a return to get the credit. Also, your adjusted gross income must be under $35,463 if single or $40,463 if married filing jointly to get the advance.
If you fall within these parameters, submit the W-5 to your employer, which will add the advance payment to your take-home pay.
You won't get the full credit in advance, but it could be as much as 60 percent, says Joanna Smith-Ramani, director of the Baltimore CASH Campaign, which offers tax preparation for lower-income filers. This reduces the chance that you would have to repay part of the credit if your income goes up during the year.
You also must file a tax return during the next filing season, which will allow you to reclaim the rest of the credit.
(Maryland has an earned income tax credit, but doesn't allow taxpayers to get any of it in advance, Smith-Ramani says.)
Consumer advocates recommend that cash-strapped taxpayers take the advance if they qualify. But Smith-Ramani says many don't because they like getting the full credit as a tax refund in the spring.
Yet the advance may not be around much longer anyway.
There has been a high rate of error and some suspected fraud in the advance credit, and the Obama administration has proposed eliminating it, Wancheck says.
"It might be the last year," he says.