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INCOME TAX CREDITS AVAILABLE FOR FAMILIES WITH CHILDREN

SHARE INCOME TAX CREDITS AVAILABLE FOR FAMILIES WITH CHILDREN

"Significant" tax assistance is available to families with children, according to a national expert on family and women's issues.

To qualify for an "Earned Income Credit," a family must earn less than $21,250. There is no income limit on the "Child and Dependent Care Credit," but the higher the child-care expenses and the lower the income, the larger the credit, up to $1,440, according to Nancy Duff Campbell, co-president of the National Women's Law Center.Campbell and colleague Shirley Sagawa visited Utah Tuesday to conduct two training workshops for people who want to provide tax credit income tax preparation assistance.

Many people don't file for the credit because they don't owe or pay any taxes, Sagawa said. Because it is a credit, qualified families that don't generally file taxes because they have no liability could get a refund by filing the tax forms. The Earned Income Credit is filed on a two-page form, but if people complete the first page, the IRS will calculate the credit. The form is part of the standard 1040 and 1040A tax package, but anyone can receive one by calling the IRS.

There is also a heath insurance credit, which allows families with at least one qualifying child to deduct premiums paid for health insurance.

"From what we know, one of five eligible families didn't take (the credits). Because the forms are a little more difficult this year, we are guessing that we might see those numbers increasing and we don't want to see that happen," she said.

The Internal Revenue Service estimates that 14 million families nationwide will qualify for the Earned Income Credit, according to Jan Hadley, IRS public affairs officer. In 1987, about 67,000 Utahns claimed the credit, which has since been increased. The maximum credit, $2,020, "is a lot of money to put into the pockets of low-income families," Hadley said.

The credit will not be counted against eligibility for public assistance programs such as Supplemental Security Income, Aid to Families with Disabilities and General Assistance, as long as it is spent within two months," Campbell said.

Sagawa and Campbell were in Salt Lake City to provide technical assistance in training people who would like to help with the forms. Utah Issues and Utah Children jointly applied for the technical assistance grant, and Salt Lake City was one of seven sites nationwide to receive the assistance. More than 40 volunteers - most of them from state-run programs, advocacy groups and child-care centers - attended the morning training session.

While most parents can take both credits, parents who have a child younger than 1 will have to choose which credit to take.

For information on the credits, call the IRS at 1-800-829-1040.