For Immediate Release
Jan. 31, 2020
NOTE: This event was streamed and video is available on Facebook, and photos are available upon request.
EITC Awareness Day helps spotlight credit signed by President Ford and its benefits to West Michigan workers
GRAND RAPIDS—State and community officials, policy advocates, local residents and the curator of the Gerald R. Ford Presidential Museum gathered today to recognize President Ford’s role in creating the Earned Income Tax Credit (EITC) and the credit’s lasting impact on the working families who receive it. The event coincided with EITC Awareness Day, a national effort organized by the IRS and its partners to promote the EITC and ensure every qualified worker claims and receives their tax credit.
The federal Earned Income Tax Credit was signed into law in 1975 by Michigan’s own President Gerald R. Ford. Created by a Republican president and a Democratic majority in Congress, the EITC has continued to have strong bipartisan support ever since. The six U.S. presidents who succeeded President Ford all signed a federal EITC expansion into law.
“With a signature of his executive pen in 1975, President Ford helped establish the Earned Income Tax Credit, laying the foundation for important expansions and improvements on it at both the federal and state level in the decades that followed,” said Donald Holloway, Curator at the Gerald Ford Presidential Museum. “The EITC continues to be an invaluable tool in helping reduce poverty for workers and their families, and in turn, a living, working part of President Ford’s legacy.”
In addition to the federal EITC, a state EITC based on the federal credit was established in 2006 under similarly bipartisan circumstances. The Michigan EITC was created under Republican majorities in the Michigan House and Senate, spearheaded by former West Michigan Senator and Senate Majority Leader Ken Sikkema, and signed into law by Gov. Jennifer Granholm.
Both credits have a significant impact on reducing poverty for families in Grand Rapids and around the state. In Kent County for the 2017 tax year, about 45,230 (14.5 percent) of taxpayers received the Michigan EITC at an average of $143, spending $6.46 million locally.
Grand Rapids resident Rebeca Arredondo is one of those workers who has benefited from the EITC, and shared her personal perspective at today’s event.
“With school loans to pay and all the bills for my family’s basic needs like housing, utilities and car insurance, I pretty much have to live paycheck to paycheck. It makes it extremely hard to save for unexpected bills, school loans and property taxes without getting a yearly return,” Arredondo said. “The EITC gives me peace of mind knowing that when I get my refund I’m able to put it toward my school loans, car repairs or any other unexpected situation, plus it’s what I always use to afford to pay my property taxes. Thanks to my EITC, I’ve managed to keep my home and give security and stability to my son.”
Helping local workers understand what the EITC is and find out if they are eligible is vital to the credit’s success, so much so that the Kent County Tax Credit Coalition was created in 2002 for that very purpose. The Coalition offers free tax return preparation, assistance with filing for the EITC and other tax credit claims, and financial literacy courses. This year, the Coalition will provide free tax preparation and e-filing services for workers at 14 sites throughout Kent County.
Over the life of the program, the Kent County Tax Credit Coalition has helped bring over $96 million in tax refunds back into the community and served over 95,000 taxpayers. In 2019, it prepared more than 7,000 returns, generating $6.2 million in refunds and credits like the EITC.
“The EITC is an extremely effective tool in both fighting poverty and stimulating the local economy, but it only works if the people who qualify for it know about it,” said Brenda Brame, Program Manager for the Kent County Tax Credit Coalition at the Heart of West Michigan United Way. “The benefits of the EITC have a ripple throughout our community, as the money workers get back is often spent locally on groceries, car repairs, medical care, or a new appliance. We hope businesses, policymakers and advocates will join us in spreading the word and promoting the EITC this and every tax season.”
The Michigan League for Public Policy has been working since 1912 to reduce poverty, encourage economic security and promote racial equity, and the federal and state EITC do all three. But it can do much more. The Michigan EITC was established at 20 percent of the federal credit. In 2011, it was drastically cut down to 6 percent of the federal credit. Several bills are currently before the Michigan Legislature that would restore the state credit, including those cosponsored by legislators from West Michigan. Public polling shows strong support for expanding the EITC as well.
“Throughout its history, the EITC has had nearly universal support—by Democrats and Republicans, rural and urban residents, and businesses and workers,” said Gilda Z. Jacobs, President and CEO for the League. “Expanding the EITC has strong public support, and carrying on the legacies of President Ford and my former colleague Senator Sikkema, West Michigan elected officials are again helping lead the way. We hope lawmakers from both sides of the aisle and across the state can work together to restore our state EITC, better support Michigan’s struggling families, and unleash more of the credit’s purchasing power in Michigan’s local communities.”