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by Rosemary Heins, University of Minnesota Extension Service
Tax credits are available for Minnesota working families that will help them pay for items on their "wish" list.
This wish list may include paying off out-of-pocket health care costs or large utility bills, or having an emergency fund. It might even be for a down payment on a house or a renter's deposit on a safer place to live.
More than 252,000 Minnesota families and individuals claimed the federal Earned Income Tax Credit (EITC) last year. For 2005, the EITC can be as much as $2,662 for taxpayers with one qualifying child; $4,400 for taxpayers with two or more qualifying children; and up to $399 for taxpayers without a qualifying child.
Workers may be eligible for the EITC/WFTC if they have:
One child and family income was less than $33,030
Two or more children and family income was less than $37, 263
No children, but were ages 25-64 and income was less than $13,750
Both the EITC and WFTC can reduce taxes owed to zero, and may result in a refund. Workers can get money from the credits even if they don't earn enough to owe any income taxes!
Working families may also be eligible for the:
Child Tax Credit (federal)
Child and Dependent Care Credits (federal and Minnesota)
Hope and Lifetime Learning Credits for college tuition (federal)
Retirement Saving Contribution Credit (federal)
Minnesota K-12 Education Credit and Subtraction (Minnesota)
Property Tax Refund for homeowners & renters (Minnesota)
Eligibility guidelines and income limits vary across the different credits. Keep in mind that eligible taxpayers can file three years back for unclaimed tax credits except for a one-year limit on the property tax refund.
From Feb.1 until April 15, trained volunteer tax help is available throughout Minnesota to help people complete tax forms and the service is free. To find a site near you, call "First Call for Help" at 2-1-1 or dial 1-800-543-7709. You may also go online to http://www.taxes.state.mn.us for free tax assistance information.
(Rosemary K. Heins is a family resource management educator with the University of Minnesota Extension Service Regional Center, Andover)
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