2021 | Opinion

Opinion: Expansion of Earned Income Tax Credit for low-income earners is vital

Montgomery County enhanced opportunities, but not enough people claim benefit

share this

Cross Community & The Equity Center recently concluded a comprehensive survey on the critical post-pandemic needs of the people they serve, specifically low-income and immigrant residents in Gaithersburg and Montgomery Village.

As a state delegate for District 39, I also represent these respondents, who are among the poorest in Montgomery County, with 87 percent earning less than $40,000 per year. A survey of upcounty immigrant poor of this magnitude is unprecedented, collecting more than 1,300 responses.

The results generated hard data that supports what many in this work know well from experience: Some government programs have a hard time connecting with these populations.

These communities are often hard to reach because of language barriers, lack of access to technology, and inability to navigate the complex systems that are required to access assistance. Another issue is the inherent mistrust of the sources in charge of providing information — as many of these people are immigrant non-citizens.  

These new findings, however, will give policymakers — perhaps for the first time ever — a remarkable window into the world of those living on the margins. As a result, we can create more effective strategies to connect the very hard-to-reach populations with support to ensure post-pandemic economic growth that includes everyone in Montgomery County, not just those with means.

An important and timely example of this is the Earned Income Tax Credit (EITC).

The EITC is widely acknowledged as one of the nation’s most effective anti-poverty programs. Maryland is one of 28 states that adopted its own version of the EITC for state tax filers.

In early 2021, Maryland became one of three states to expand EITC eligibility to those who file with an Individual Tax ID Number (ITIN). This opens the door to benefits once unattainable for tens of thousands of previously ineligible low-income workers in Maryland. 

Montgomery County, I am proud to say, has seized on this powerful, positive legislation by making it now possible for low-income households to double their EITC through the Working Families Income Supplement (WFIS) program. This means that residents who responded to this survey will have a real chance to find a path toward stability — that is, if these low-income workers are aware of and are able to access the EITC. 

It is far more likely that the barriers ranging from language to technology to the general mistrust of the government will not yield EITC participation results we hope for.

According to the Urban Institute, about 5 million potentially eligible taxpayers in the U.S. do not claim the EITC credit each year, resulting in about $7 billion in unclaimed benefits annually. This amounts to nearly 20 percent of eligible tax-filers who do not claim the EITC. 

Our challenge is to fully connect our hard-to-reach communities with these important resources.

To avoid missing the mark on delivering EITC and other anti-poverty benefits, such as the Child Tax Credit, my colleagues and I must draw upon the expertise of on-the-ground organizations like Cross Community and The Equity Center.

Smart government requires partnering with groups that have built deep and trusted relationships with the individuals and families our policies are intended to serve and are, as such, the most logical entities to determine the best way to reach them.

By empowering and investing in the organizations that are already baked into the community, we can ensure that the hard-working members of our county who live below the poverty line can fully benefit from these hard-earned services and resources. 

Lesley Lopez lives in Germantown and is a state delegate for Maryland’s 39th District.

***

Editor’s note: Bethesda Beat encourages readers to send us their thoughts about local topics we have covered for consideration as a letter to the editor or op-ed piece in our Saturday newsletter. Email them to editorial@bethesdamagazine.com. Here are our guidelines. We require a name and hometown for publication. We also require a phone number (not for publication) for us to verify who wrote the letter. Please provide a source for any facts in your letter that were not part of our coverage; if they can’t be verified, they likely will be omitted. We do not accept any submissions from a third party; it must come directly from the writer. We do not accept any pieces that have been published or submitted elsewhere.