Proposal
Establish a Greenville College Tax Assistance Program. Any resident of Bond County who is eligible for the IRS Earned Income Credit (EIC) may make an appointment and have his/her federal income tax return prepared at no charge. We will advertise this program through fliers posted in area retail establishments. We will also obtain publicity from local radio and newspapers. Tax returns for these individuals will be prepared by students in the Income Tax course. Preparation of tax returns will be a class requirement. Larry Sayler will supervise the program.

Goals

• Provide accounting students with practice in preparing income tax returns
• Instill in students a greater empathy for those who are financially needy
• Help low income families obtain tax refunds which otherwise may go unclaimed
• Establish good public image for Greenville College

Rationale
For many years the US Government has had the goal of providing financial assistance to low income, working families. This is accomplished through the EIC. The government recognized that very low entry level wages may not provide sufficient incentive for people to leave welfare rolls. The EIC provides additional incentive for low income people to leave welfare rolls and obtain jobs. Unfortunately, many, perhaps most, people eligible for the EIC are not aware of it and do not receive the benefit that is intended.

EIC
The EIC is essentially a negative income tax. That is, it provides a tax refund to certain families even if that family has had no taxes withheld for the year. If someone eligible for the EIC has had taxes withheld, they will receive a refund of all that has been withheld, plus receive the EIC amount to which they are entitled.

The amount of EIC depends on a person's income and the number of qualifying children. With two or more qualifying children, an individual may receive a maximum EIC of about $3,800. The more wage income the filer has, the greater the EIC, up to income of $9,500. (This provides the incentive for very low income people to earn additional income.) From $9,500 to 12,500 of earned income, the EIC remains at $3,800. Above $12,500 of income, the EIC begins to diminish. However, the EIC is not completely phased out until income reaches $30,600. Thus, people with two children and income of $25,000 or $30,000 are still entitled to an EIC refund.

Tax payers with one qualifying child may receive a maximum EIC of approximately $2,300. Tax payers with no qualifying children may receive a maximum EIC of $350. (However, if a tax payer has no qualifying children, the tax payer must be at least 25 years old. Thus, most of our students, although they have relatively low income, are not eligible for the EIC.)

Community Relations
Several organizations in Greenville and Bond County provide tax preparation services for a fee. Some of these organizations may resent a service that provides tax return preparation for free. However, many of the people eligible for the EIC are not aware of the EIC and do not currently file tax returns. Of those who do file returns, they are relatively simple returns and do not result in large fees for the commercial tax preparation services. To additionally placate local businesses, we will develop a list of area organizations that prepare income tax returns. When someone who is not eligible for EIC contacts us, we will give that person the list of those in the area who do prepare tax returns. Thus, we will be providing additional referrals to local businesses.