Vitelli bill would inform employees of the Earned Income Tax Credit

Posted: April 13, 2017 | Senator Vitelli

AUGUSTA — A bill by Sen. Eloise Vitelli, D-Arrowsic, would ensure employees are informed about their potential eligibility for the Earned Income Tax Credit, or EITC, which provides larger tax returns for tens of thousands of low-income Mainers.

The bill — LD 1088, “An Act to Require that Employees Be Informed of Potential Eligibility for the Earned Income Tax Credit” — received a public hearing before the Labor, Commerce, Research, and Economic Development Committee on Wednesday.

The EITC is a tax credit for low-income workers and families that has been around for 40 years. While nearly 100,000 EITC claims were made in Maine in tax year 2016, nearly 25 percent of eligible tax filers in the state do not claim it. Sen. Vitelli’s bill would require employers to post a notice informing their employees of their potential eligibility for the credit.

“The Earned Income Tax Credit allows low and middle income Mainers who worked hard and paid taxes to get more of their money back,” said Vitelli. “However, nearly a quarter of Maine tax filers miss out. This bill is a simple step towards ensuring we don’t leave money on the table to hard-working Mainers.”

EITC claims in Maine brought back $207 million in refunds, for an average of $2,108 in 2016 and from 2009 to 2013, approximately 17,000 Mainers were lifted out of poverty each year by the EITC. Tax prep locations in Sagadahoc County alone helped return over $230,000 to filers on the midcoast last year.

“This bill would be an immensely helpful tool in getting the word out to the people who are eligible to file for the EITC but do not do so,” said Janet Smith, a Regional Manager for New Ventures Maine. “Part-time and seasonal workers, workers with disabilities, and older workers are some of the groups of individuals who are often not aware that they have a requirement to file and miss the chance to receive this tax credit”

The bill also received the support of AARP Maine and the Maryland CASH Campaign at the hearing. The state of Maryland passed a similar proposal in 2010.

LD 1088 faces further action in the Labor, Commerce, Research, and Economic Development Committee and votes in the House and Senate.