Making the Link

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Making the Link

• Virginias Earned Income Tax Credit (EITC)
  Initiatives and Virginia Individual Development
  Accounts (VIDA)

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Welcome!

• Internet meeting link
• Teleconference link
• For technical assistance, contact the webinar
  host, Emily Buckham
• Email buckham_at_systemsandsoftware.org
• Chat QA Pod (Sent to host and presenters)
• Phone [phone]

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Purpose of this training series

• To improve the capacity of Virginias Community
  Action Agencies, Departments of Social Services,
  and EITC coalitions to help Virginias low-income
  working families and individuals build their
  assets

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Training series sponsors
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Purpose of this Webinar

• To provide information about the requirements and
  benefits of the Virginia Individual Development
  Accounts (VIDA) matched savings program for
  low-income clients
• To provide an overview of the federal Earned
  Income Tax Credit (EITC) for TY 2008
• To encourage agencies and EITC coalitions to help
  their low-income clients make the link to a
  VIDA account when they receive their EITC tax
  refund

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Todays agenda

• Virginia Individual Development Account
• Earned Income Tax Credit
• Making the Link
• Audience QA

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Todays speakers
CAROLYN SPOHRER EITC Project Manager,
Virginia Community Action Partnership

• LOUELLEN BRUMGARD
• Associate Director, Virginia Department of
  Housing and Community Development

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Todays speakers, cont.
HOLLIE CAMMARASANA Public Relations
Director, Virginia Department of Housing and
Community Development
SABRINA BLACKETT Program Administrator,
Virginia Department of Housing and Community
Development
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QA

1. During the QA session, dial 71 on your
phone to ask a question. Lines will be opened in
the order received. 2. At any time, submit a
question online via Chat QA. Presenters will
respond to these questions during the QA session.
Chat QA
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Poll Whos with us today?

• Virginia Department of Social Services (state and
  local DSS offices)
• Community Action Agencies (CAA)
• Member of an EITC coalition
• Virginia Individual Development Accounts (VIDA)
  affiliates
• CAA, EITC, and VIDA
• Other

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Poll Your experience with this topic?

• Very experienced
• Somewhat experienced
• New to this topic

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Speaker
LOUELLEN BRUMGARD Associate Director,
Virginia Department of Housing and Community
Development
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Context for EITC-VIDA Link

• EITC is the portal for asset building
• Third annual EITC/VIDA event
• Build the knowledge Build the relationship
  Build the assets

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What is the programs purpose?

• VIDA emphasizes
• Saving - learning to save on a consistent basis
  and utilizing financial institutions
• Financial literacy - enhancing ones financial
  knowledge
• Acquiring assets building wealth

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What is VIDA?

• A special savings program that helps eligible
  individuals gain financial literacy skills and
  build assets.
•  
• For every dollar the participant saves in a
  designated account, VIDA will match it with two
  dollars, up to 4,000 per participant with a
  maximum of two participants per household. 

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How can the money be used?

• The combined savings can be used to
• Purchase a home (first-time homebuyers)
• Start a business
• Obtain an education (education for self, spouse
  or child and includes vocational, community
  college, undergraduate or graduate degree)

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• An IDA account can jump start the road to saving
• An opportunity to do more with their tax refund
• Savings plans and financial education help
  realize other goals

• Why encourage
• individuals to take advantage of IDAs?

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• How EITC client can triple their tax refund
• 1,000 Deposits a portion of tax refund into a
  VIDA account
• 600 Makes 25 monthly deposits for two years
• 3,200 Earns 21 in match funds
• 4,800 Available to use towards asset
  purchase

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• Participant eligibility
• U.S. citizen or legal resident, residing in
  Virginia
• Meet the income requirements
• Have a dependent child under the age of 18 living
  within the household with their parent or
  guardian if saving for education or business
• Be employed (part-time or full-time)
• Have less than 10,000 in savings or business
  assets (excluding vehicle)

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• 2008 Income Limits

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• The Saver must
• Save at least 25 per month
• Complete financial skills training asset
  specific training provided by the intermediary.
  Examples of training credit, taxes (EITC),
  banking, financial obstacles, homebuyer
  education.
• Complete training prior to making a match funds
  request. Six-month minimum participation
  required.

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• The Saver, cont.
• Has up to two years from enrollment to complete
  the program
• Can deposit earned income and tax refunds into
  the account
• The participants money is the only money held
  within the account, the participants savings and
  earned match funds are sent directly to the
  vendor for the asset purchase
• Any withdrawals must be coordinated through a
  VIDA intermediary

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• Intermediaries
• Recruit candidates review applications
• Assist potential candidates with budget, credit,
  savings goal and other issues
• Provide encouragement
• Provide savers with training (or partner with
  other agencies to deliver)
• Assist savers with withdrawal process

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• Intermediaries, cont.
• Currently 53
• Represent a range of organizations
• CAP agencies
• Redevelopment and Housing Authorities
• Non profits
• Local governments
• Credit Unions

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• Where we are currently
• Over 260 savers enrolled
• 80 graduates August 2005
• Breakdown of asset goals
• Homeownership 70
• Education 19
• Business 11

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VIDA Program

• Virginia Department of Housing and Community
  Development501 North 2nd StreetRichmond,
  Virginia 23219(804) 371-7030vida_at_dhcd.virginia.g
  ovwww.dhcd.virginia.gov

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Speaker
CAROLYN SPOHRER EITC Project Manager,
Virginia Community Action Partnership
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EITC Coalitions

• Help low and moderate income working individuals
  and families by
• Promoting the earned income tax credit
• Providing free income tax preparation
• Promoting financial opportunities to the
  unbanked
• Financial education programs
• No Joke To Be Broke
• Promote saving and self-sufficiency
• Asset building opportunities, matched savings
  programs like VIDA

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How does EITC help?

• Reduces amount of federal tax owed
• Can result in a refund check
• Single largest federal program designed to lift
  people out of poverty
• In 2006, 43 billion was refunded to 22 million
  taxpayers

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EITC Potential

• Teaching taxpayers to understand and/or prepare
  returns on their own
• Eliminate waste of almost 2 billion in paying
  fees of commercial preparers
• 100 of refund to remain with taxpayer to
  preserve the value of the credit

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Who is eligible?

• Taxpayers/dependents must have a Social Security
  Number to qualify for EITC
• Taxpayers must work full or part time and have
  earned income of at least 1.00
• Be age 25 but under 65
• Income and family size determine amount of EITC

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2008 Tax Year Income Limits

• No qualifying child
• 12,880 (MFJ 15,880)
• Credit up to 438
• One qualifying child
• 33,995 (MFJ 36,995)
• Credit up to 2,917
• Two or more qualifying children
• 38,646 (MFJ 41,646)
• Credit up to 4,824

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Why do some miss out?

• 20-25 do not apply.
• They dont file taxes
• Single-8,950 MFJ- 17,900 H of H- 11,500
• They dont know about EITC
• They fear they will owe taxes
• They have a language barrier
• They may know about EITC but fear losing
  eligibility for other benefits

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Who else is working on EITC?

• Virginia Individual Development Account
  Intermediaries
• (DHCD, VHDA)
• Housing and Homeless Advocates
• Volunteers
• AmeriCorps, community volunteers, corporate
  partners
• Community Action Agencies
• Volunteer Income Tax Assistance (VITA)
• IRS and AARP
• VA Department of Social Services
• Local Departments of Social/Human Services
• Places of worship, Schools
• United Way
• Banks and Credit Unions

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Make the Link with your Volunteers!!

• Engage your Volunteers from the start
• Include VIDA information during tax training
• Ask about VIDA interest in Preparer Use Fields
• Have VIDA flyers available at tax site
• Partner with Intermediary from the start
• Can Intermediary be at tax site to answer
  questions?

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Websites to visit

• VACAP EITC website
• Brookings Institution
• Center on Budget and Policy Priorities
• Annie E. Casey Foundation
• National Community Tax Coalition
• Internal Revenue Service
• National League of Cities
• Federal Deposit Insurance Corporation

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Speakers
HOLLIE CAMMARASANA Public Relations
Director, Virginia Department of Housing and
Community Development
LOUELLEN BRUMGARD Associate Director,
Virginia Department of Housing and Community
Development
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2008 Making the Link

• Push people to EITC sites through toll free
  number
• EITC sites promote VIDA
• 2008 PSAs 1-panel brochures table tents
  give-away magnet

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2008 Material
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Making the Link in 2009

• Survey of EITC sites
• Not all sites/coalitions were aware of the
  material
• Table tent format was helpful
• Other suggestions included Ask Me How buttons
  working with big tax preparers posters tray
  liners at fast food restaurants encourage saving
  just a portion of EITC refund

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Making the Link in 2009 Input

• Create an event during tax prep season
• Focus promotion (PSAs, collateral material, etc.)
  on a selected weekend
• Contest of EITC/VIDA sites

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Making the Link in 2009 Input

• What would be good weekends or dates for a
  VIDA/EITC promotional event (push)?
• What can VIDA and VIDA intermediaries do to help
  you talk about VIDA to your EITC clients?
• Would you be willing to participate in a friendly
  competition?
• Other thoughts and comments?

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QA

1. During the QA session, dial 71 on your
phone to ask a question. Lines will be opened in
the order received. 2. At any time, submit a
question online via Chat QA. Presenters will
respond to these questions during the QA session.
Chat QA
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Contacts

• Virginia Community Action Partnership
• http//www.vaeitc.org
• Carolyn Spohrer
• [phone]
• cspohrer_at_vacap.org

• Virginia Department of Housing and Community
  Development
• http//www.dhcd.virginia.gov/
• Louellen Brumgard
• [phone]
• louellen.brumgard_at_dhcd.virginia.gov

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Save the Date Additional Training

• Whats New This Tax Season?
• Thursday, December 18, 2008, 9am-10am EST
• Speakers will brief you on important tax law
  changes for TY 2008
• Registration information coming soon

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Wrap up

• Thanks to everyone who participated in todays
  Webinar!
• A recorded version of this Webinar will be
  available online, on demand. You will receive an
  email notice when it is available.

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Evaluations

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