Workers Not Living with Children

Fact:

In 2012, workers not raising children who are eligible for the EIC had average annual earnings of about $7,650. About half of them work in service industries. About 19 percent work full-time, year-round. About 44 percent are single men and 37 percent are single women. About 19 percent are married.

Tax credits can represent a useful income boost for lower-wage workers who do not have children living with them — including non-custodial parents and childless workers. Workers not living with children who earn less than $14,340 (or $19,680, if married) receive only a small EIC (averaging about $264), but non-custodial parents may be able to claim a substantial CTC if they are permitted by a divorce or separation agreement to claim a child as a dependent. The CTC can be worth up to $1,000 per dependent child under age 17 for workers who earned more than $3,000 in 2013. It is important to bring this news to workers who may know they do not qualify for the EIC, but who may not understand that they could qualify for the CTC.

Many of the places that are natural gathering points for families with children — such as schools and child care programs — may not be fruitful outreach settings for this group of workers. Special strategies are needed:

  • Target workers who are likely to have been employed on and off during the year. Distribute materials at: pick-up and drop-off spots for day labor;  hotel, motel and other service worksites that may hire seasonal employees; General Assistance, SNAP (food stamp) or unemployment offices;  and programs serving migrant workers.
  • Identify individuals whose circumstances have impeded their efforts to work. Try reaching them through: Veterans Administration hospitals or service centers; transitional housing programs; homeless shelters, food banks and soup kitchens; probation offices; half-way houses or mental health or substance abuse service centers; and literacy or GED programs.
  • Reach out to workers in school or training programs. Distribute materials at: universities with non-traditional students; community colleges;
  • English as a Second Language or literacy programs; vocational rehabilitation centers; and job training programs.
  • Alert the state or county Child Support Enforcement agency (also referred to as the IV-D agency), which establishes child support orders typically requiring non-custodial parents to pay a set amount of child support each month — and provides services to enforce these orders. As part of its work, the IV-D agency may have contact with non-custodial parents and can use such opportunities to provide information about how they may qualify for the tax credits.
  • Provide tax credit information when child support obligations are being established either through a court or an administrative process. Decisions about which parent claims the child as a dependent for tax purposes are often made at this time. Information about the CTC can be provided to both parents at the same time they are notified about the process for establishing child support.
  • Ask employers to help inform workers about the tax credits. A special note about the availability of the CTC may be of particular interest to non-custodial parents whose child support payments are being deducted from their paycheck.
  • Reach out to Fatherhood Programs. This broad range of community-based human service initiatives are aimed at nurturing men in their roles as fathers and caregivers to children. Some groups are geared toward assisting fathers in particular circumstances or life stages, such as teen fatherhood programs; others focus on helping young men develop employment and life skills, as well as parenting skills.
Tax Credit Outreach IN ACTION

Catholic Charities in Fort Worth, Texas has participated in the United Way Tarrant County Financial Stability Initiative since 2010. In 2013, in an effort to reach workers without children in particular, Catholic Charities hosted a tax seminar at Texas Wesleyan University and included tax credit information ads in newspapers for the Tarrant County Community College District and the University of Texas at Arlington.

Catholic Charities also partnered with the Tarrant County Next Step Program, which helps recently released ex-offenders return to the workforce, to deliver three tax education sessions to program participants. The sessions provided information about the EIC, CTC, free tax filing assistance, and savings bonds. Session participants also helped distribute materials promoting VITA sites to apartment complexes in the community to fulfill a community service requirement.

Additionally, Catholic Charities shared tax credit information in four senior workshops and expos for adults ages 55 and older.

As part of its comprehensive outreach strategy, United Way Tarrant County and Catholic Charities mailed nearly 4,000 VITA postcards to local churches and prior-year clients, led 12 tax education seminars, and delivered financial education sessions through its Money School Classes, which reached more than 2,000 participants. The classes included a tax segment during which participants were encouraged to use VITA sites and invest in savings bonds.

In 2013, the Tarrant County Financial Stability Initiative filed 4,352 returns, providing $3.4 million in EIC refunds.

Contact: Pennie Clayton, Catholic Charities, (817) 308-9306, pennieclayton@ccdofw.org

Glad You Asked That!

Q: What special forms must non-custodial parents complete in order to claim the CTC?

A: Non-custodial parents eligible to claim the CTC must use the 1040 or 1040A and attach Form 8332, “Release/Revocation of Release of Claim to Exemption for Child by Custodial Parent,” which requires the custodial parent’s signature, and Form 8812 to claim the CTC. (They may not use the 1040 EZ.)