For low income families, finding a way to stretch each dollar can be important. Many look forward to their tax refund as a welcome relief to living on a budget. In Minnesota, the state government has enacted their own version of the Earned Income Tax Credit (EITC), which helps working families stay out of poverty and encourages them to remain employed despite low wages.<\/p>\n
Minnesota\u2019s credit follows similar models to the federal credit, in that it has the same eligibility guidelines and models, however the state has developed their own income thresholds for phase-out of the credit. A taxpayer who was eligible to claim the federal credit will also be eligible for the state credit, provided they are a resident of Minnesota.<\/p>\n
While the other twenty-four states and D.C. offer a state EITC that is a percentage of the federal credit, Minnesota\u2019s EITC is granted at a percentage of income. The average credit percentage is 34%, and takes into account the Working Family Credit divided by the projected federal spending on the EITC in the state of Minnesota. These amounts are projected by the states House Research Department. Each year, the average percentage amount fluctuates.<\/p>\n
Minnesota\u2019s EITC is fully refundable, which means that any excess amount of credit past the taxpayer\u2019s tax liability can be returned to them by way of a refund. This way, working families are able to retain more of their own money and use it how they see fit. Refundability is the key to success with both the state and federal EITC.<\/p>\n
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For low income families, finding a way to stretch each dollar can be important. Many look forward to their tax refund as a welcome relief to living on a budget. In Minnesota, the state government has enacted their own version of the Earned Income Tax Credit (EITC), which helps working families stay out of poverty […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[126],"tags":[325,487],"class_list":["post-925","post","type-post","status-publish","format-standard","hentry","category-states","tag-minnesota","tag-state-eitc"],"yoast_head":"\n