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NYC tax credit program set to give extra cash to over 800,000 New Yorkers

(GOTHAMIST) Elizabeth Kim, March 3, 2023

With tax season underway, Mayor Eric Adams is seeking to get the word out about a little-known tax credit program that was expanded last year for the first time in nearly two decades, marking one of his key policy achievements for low-income New Yorkers.

“This is one of the areas that we are really proud about,” Adams said during a news conference at City Hall on Friday.

The mayor has positioned himself as a mayor committed to helping the city’s working-class, and it was the theme of his recent State of the City address.

Known as the Earned Income Tax Credit, or EITC, the credit gives a tax break to low-income working New Yorkers. Families of four earning less than $80,000 a year and single-tax filers earning less than $55,000 are eligible for the credit.

The program is federally run, but both the state and city can chip in additional money for eligible recipients.

The Adams administration last year secured state approval to allow the city to increase its EITC commitment from around $100 million to $250 million annually. The state, meanwhile, agreed to chip in a one-time payment of $100 million.

City officials estimate that over 800,000 residents will qualify for the credit this year. The size of the credit for eligible residents is the largest it has ever been. Because the state’s contribution is only guaranteed for this year, it is unclear if it will ever be this large going forward. 

The increase in the benefit will be sizable. As an example, city officials said that a single parent with one child and an annual income of $14,750 or less will see their EITC benefit rise from $187 to $933, a 400% increase.

As part of a $1.5 million marketing campaign, the city will promote both the tax credit program and its free tax preparation services. The ads will appear beginning on Saturday across a range of platforms, including television, radio, social media and billboards. They’ll also run on streaming services Netflix and Hulu.

Experts say the additional tax credit comes at a critical time, as the federal government has pulled back its emergency pandemic aid in the form of the expanded child tax credit and extra food stamps.

“The data shows that economic hardship is far above what it was before COVID,” said James Parrott, director of economic and fiscal policies at the New School’s Center for New York City Affairs.

Parrott applauded Adams for both expanding the tax credit as well as launching a public awareness campaign that encourages eligible New Yorkers to reach out to the city for help in filing their taxes and getting the credit.

“Local governments have to do a lot to publicize the EITC,” he said. “Unfortunately, the paperwork on this is really challenging.”

To learn more, New Yorkers should call 311 or visit nyc.gov/getcredit.

Clarification: The article has been updated to clarify that it remains unclear whether this year’s Earned Income Tax Credit for city residents will be as large in future years.

Source: Gothamist