While our local economy is rebounding, we still have a long way to go before all of our citizens feel financially stable. As we go through tax season, many citizens who may be struggling to make ends meet should be aware of an important service in our community: the Central Kentucky Economic Empowerment Program or CKEEP.
It is a community coalition, led by United Way of the Bluegrass, that partners with the IRS to offer free tax preparation to low-income families.
In 2012, nearly 200 volunteer tax preparers were able to serve 3,875 families, resulting in over $5.7 million in tax refunds. Also $775,000 was saved in tax preparation fees.
It is really easy to take advantage of the service. Just call 2-1-1 to make an appointment at any of the 13 locations in Fayette County.
Of the $5.7 million in refunds received last year, $2.2 million was due to the federal Earned Income Tax Credit. Millions of dollars are lost each year by failing to file this credit. The IRS estimates 20 to 25 percent of those eligible do not file.
Designed to give assistance to families who are working, but do not earn a lot of money, the EITC can be just the thing to help families over the poverty line. We encourage the community to help us tell citizens about the EITC and that people can help them apply for free.
The impact of CKEEP in the Bluegrass region is significant. In a recent study, the multiplier effects of getting money back to people who earned it gave a $12.96 million boost to our local economy.
On a personal level, Monica Ross of Lexington has taken advantage of the services and is very pleased. A friend had referred her to the 2-1-1 call-in service to set up an appointment. It was really easy once I called. All the paperwork was handled by the tax preparers.
This program really helps families who work, but have expenses like child care. It helps make ends meet. She is hoping that we can spread the word to others so they can take advantage of the program as well.
An opportunity for advocacy in Kentucky is to enact legislation that provides for a state EITC. Twenty-five states and the District of Columbia have taken the next step and offer one.
According to Kentucky Youth Advocates, a state EITC would improve the lives of Kentucky families. Research shows that in families receiving additional income through EITCs, their children saw improvements in their math and reading comprehension. They also show improved levels of income when they become adults.
Studies have also shown that state EITCs are correlated with better health outcomes in children throughout their lives. The federal EITC is credited as the nations most effective program in pulling families out of poverty. A Kentucky EITC would take it one step further and help families become more financially stable and better able to enhance our local economy.
If this issue interests you, become involved. Volunteer as a CKEEP tax preparer or help to spread the word to families about the free tax services and tax credit. Together we can make a difference.
Owen Cropper is chair of the Financial Stability Impact Council of United Way of the Bluegrass.