From January 17 through April 17, 2007, over 860 volunteers working with 22 coalitions provided free tax preparation services to those eligible. Over 11,000 federal returns were filed with refunds totaling over $10.6 million. Of those, over 2,900 claimed the EITC with refunds of almost $4 million. The full value of the credit was preserved for working families and individuals because they did not have to pay for tax preparation services. Since over 80% of tax refunds are spent in the local community, this provides a significant economic impact. The Virginia Employment Commission estimates the value of volunteer time to be almost $19.00 per hour translating into about $500,000 in value to the program. Highlights of the tax season included linking EITC with VIDA, encouraging banking relationships, financial literacy programs and credit repair clinics.

Compared to the 2005 tax year, this represents:

• Double the number of returns prepared
• Almost 50% increase in number of EITC returns
• Almost $1 million increase in EITC refunds
• Double the savings to taxpayers
• One -third increase in the number of coalitions in Virginia

VACAP believes that the significant increase in activity is due largely to the success of the EITC grant program.

The Virginia Community Action Partnership (VACAP) EITC Initiative supports community groups and coalitions throughout the Commonwealth as they provide free tax preparation services and promote financial literacy, savings and asset building to low income working individuals and families. VACAP, along with the Virginia Department of Social Services and the Internal Revenue Service, is working to promote the EITC through the Virginia CASH Campaign (Creating Assets, Savings and Hope). Collectively the mission is to raise awareness of the EITC among all taxpayers and to educate workers, employers, clients and customers of the importance of obtaining all credits to which they are entitled. We encourage financial literacy, savings and asset building as coalitions develop an outreach program to link EITC with other asset building programs like the Virginia Individual Development Account. All programs enable clients to work toward self-sufficiency.

The EITC grant proposals were due at the VACAP offices on November 3, 2006. Twenty four grant recipients were notified on December 5, 2006 and funds were disbursed to each coalition on December 12, 2006. Each coalition submitted a budget and plan as to how the grant funds were to be spent throughout the year. The largest allocation of funds (47%) was used for personnel costs. Some coalitions were able to hire Site and Volunteer coordinators. Some coalitions earmarked the funding to pay for an already established position within the organization. At least four coalitions applied for AmeriCorps staff persons to work before, during and after tax filing season.

Equipment purchased for tax season included computers and printers for use by the volunteers doing the tax returns. Projectors used for teaching financial literacy classes were used during and well beyond the actual tax filing season. (15%)

Advertising and printing for marketing, education and outreach totaled 13% of the total appropriation. Training and travel expenses for the 24 coalitions totaled about 6%. This training included both volunteers as well as financial literacy classes. Indirect costs totaled about 6%. Coalitions that already planned for EITC campaigns without the grant monies carried over some of the funding to be used in this year’s tax filing season. (13%)

VACAP has developed and maintains a website dedicated to the EITC Initiative and CASH Campaign. www.vaeitc.org provides timely information to EITC partners and clients and highlights programs throughout the Commonwealth. Information, data, flyers, and asset building links are available for download. The Home Page of www.vaeitc.org contains links for many partners and additional information, especially throughout tax filing season. The EITC News presents news and announcements from a variety of sources throughout the year, but especially during tax filing season. Coalitions can submit items of interest for placement on the site to benefit all partners. (p. 12)

A key component of the CASH Campaign is asset building. The Virginia Individual Development Account (VIDA) program is one way that EITC recipients can “Make Tax Time Pay". VACAP and the Department of Housing and Community Development, working with Virginia Housing and Development Authority (VHDA) and The Virginia Department of Social Services, sponsored a conference call to link VIDA intermediaries with EITC free tax preparation providers. (p.17)