“The Earned Income Tax Credit (EITC) helps low- to moderate-income workers and families get a tax break. If you qualify, you can use the credit to reduce the taxes you owe – and maybe increase your refund,” according to the IRS. 

You might think every dollar available through this program would be scooped up. But that’s not the case. In fact, according to the National League of Cities (NLC), nearly $18 billion of this financial assistance has been going unused. In fact, use has dropped, reports the NLC. In 2022, 23 million tax filers received a total of $57 billion in earned income tax credits. That’s down from 2019, when 26.7 million individuals received a total of $64.5 billion in ETIC.  

This isn’t just a pity for the families who could make good use of the cash, it also deprives localities of the benefits to their economies. As the Brookings Institution has explained, “The EITC benefits not only low-income families, but also the wider communities in which they live. Although it is widely regarded today as one of the country’s most successful antipoverty programs, the EITC was originally designed to be a temporary economic stimulus measure, in the Tax Reduction Act of 1975.”

With this in mind the NLC has stepped into the breach and developed an interactive map showing the drop in EITC filers and their benefits in zip codes across the country. According to the NLC “the map highlights zip codes where the decrease in average benefit across 2017-2019 to 2021 was greater than the national average of 8.9 percent.” 

As the NLC explained late last year, “This new EITC dashboard map shows local leaders where they can focus outreach efforts to expand participation, stimulate local economies, and lift families and individuals out of poverty. Successful outreach may include:

• “Connecting residents through mailers, schools, libraries, houses of worship, and at community events to existing free or low-cost tax preparation services.

• “Training residents to become tax preparation volunteers through the IRS’ Volunteer Income Tax Assistance (VITA) Program.

• “Working with banks and credit unions to provide matching funds to bolster household savings.

• “Partnering with existing community nonprofits that already do this work such as the United Way and AARP.”

For access to the map and instructions for its use, click here.

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