Four Things for Latino Families to Remember on Tax Day

By Yuqi Wang, Policy Analyst, Economic Policy Project, NCLR

For many Latino households, the tax refunds they receive every April is one of the largest influxes of cash they receive all year. The refunds help families pay debts, keep them out of poverty, and help to buy necessities like clothes and groceries. Below are a few things for Latino families to keep in mind as the 2016 tax filing season wraps up today.

1. You may be eligible for critical refunds, such as the EITC or CTC. Filing your taxes means that you might be eligible for critical refunds like the Earned Income Tax Credit (EITC) and the Child Tax Credit (CTC). The EITC and the CTC are two refundable tax credits that benefit low- and middle-income earners. They increase the earnings of lower-income workers, reduce child poverty, make low-wage work more rewarding, and offset the effect of paying regressive payroll taxes. Both credits raised more than nine million Americans out of poverty in 2015, and made 22 million others less poor. It is important to note that taxpayers filing with an ITIN number are eligible to claim the CTC, but not the EITC.

2. If you file your tax return with an ITIN, you may need to renew your ITIN to get a refund. Under legislation passed by Congress in 2015, the IRS requires that certain taxpayers renew their ITINs before they submit their tax return and claim certain tax credits, primarily the Child Tax Credit. Affected ITINs expired on January 1, 2017, and unless renewed, taxpayers using expired ITINs on their tax returns will face a delay in receiving eligible tax refunds. For more information and resources on renewing ITINs, visit nclr.us/ITIN.

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The President Wants to Use Your Tax Dollars to Fund His Deportation Agenda

By Laura Vazquez, Program Manager, Immigration Initiatives, NCLR

As we look ahead to Tax Day next week, many of us are thinking about the ways that tax revenue is spent. For example, tax dollars are critical to funding our country’s investments in areas such as housing, health care, education, school lunches, and Medicaid, to name a few.

Our tax dollars should reflect our country’s priorities, and fund programs that meet critical needs for communities across the country. Unfortunately, the administration is asking Congress to use our tax dollars to implement its mass deportation policy. This policy would increase the number of enforcement agents to round up undocumented immigrants and tear apart families.

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The Economic Impact of Latino Workers: A By-the-Numbers Breakdown for Tax Day

Hispanic Americans are firm believers in the American Dream: hard work will earn you and your family a better life. Expected to make up much of the growth in the American workforce in the next four decades, Latinos are helping to revitalize communities and strengthen local economies all throughout the nation. Hard work however, is just one contributing factor to ensuring that the country remains prosperous. In order to support investments in education, infrastructure, health care, and many other areas that millions of Americans rely on, everybody must contribute financially through the tax system. Luckily for this country, Latinos are a tremendous asset thanks to their commitment to paying their fair share of taxes.

In honor of Tax Day, let’s take a by-the-numbers look at the economic impact that Latinos have on the U.S. economy.

Labor Force Participation

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Entrepreneurship and Purchasing Power

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  • Despite slower growth during the recession, the number of Hispanic-owned business was projected to grow by nearly 40% between 2007 and 2013, to nearly 3.2 million businesses.
  • In 2013, sales receipts for Hispanic-owned businesses in the United States totaled almost $470 billion.
  • Because the Latino population is comparatively younger than other racial and ethnic groups and the number of Hispanics in the United States is quickly growing, Hispanic purchasing power is also expected to grow to nearly $1.7 trillion by 2019.

Tax Contributions

Photo: http://401kcalculator.org, Creative Commons

Photo: http://401kcalculator.org, Creative Commons

  • In 2013, Hispanic households paid almost $124 billion in federal taxes, including individual and corporate income taxes, payroll taxes, and excise taxes, and almost $67 billion in state and local taxes.
  • States with large Hispanic populations have also benefited from their tax contributions. Hispanic households accounted for 23 percent of state and local tax payments in Texas, 20 percent in California, 18 percent in Florida, and 15 percent in Arizona.
  • Tax contributions from Hispanic households also play a critical role in funding Social Security and Medicare. In 2013, Hispanic households contributed about $98 billion to Social Security and $23 billion to Medicare through payroll taxes. Many economists believe that tax contributions from young Latino workers will be the key to keeping the Social Security system strong.