Photo Caption: Scheneitha Franks is a Tacoma resident and working mother whose tax refund increased significantly the first year she took advantage of the free tax prep service. Photo by Red Box Pictures
KeyBank Foundation Helps Communities Reach Self-Sufficiency
“At Key, the most significant investment we make is in our communities. We believe people deserve the freedom that comes with economic self-sufficiency,” says David Parent, vice president of community relations at KeyBank.
“That’s why the KeyBank Foundation supports programs in our communities dedicated to workforce development and financial education.”
KeyBank has contributed more than $18 million annually to nonprofits across the U.S. In Washington, $1.6 million last year went to several hundred of these organizations, including larger nonprofits like United Way, Goodwill and Boys & Girls Club of America as well as community-based organizations such as Asian Counseling and Referral Service (ACRS), El Centro de la Raza and Refugee Women’s Alliance.
“We have found that the best way to reach target populations is through the efforts of existing agencies that have the expertise and history to operate successful outreach programs,” Parent explains.
At ACRS, financial education is offered alongside employment training and English language classes to about 200 community members, thanks to a $10,000 contribution to ACRS’s employment and training program every year since 2011.
“We have hosted Key Bank’s Super Refund Saturday, and with their contribution, we provide job placement, job clubs and computer classes,” says Jeff Wendland, director of employment and citizenship at ACRS. “One component of the job clubs is information and education on financial literacy (where) … we primarily teach how to budget, what income is needed for families to meet self-sufficiency, which career goals can meet their financial needs and what to do when they get their first paycheck from an employer.”
At Tacoma Goodwill, Key funds the “Key to Change” program with more then 500 participants annually completing the course. “When finished they know how to read a credit report, identify predatory lending, and begin the process of gaining control over their financial lives,” says Parent.
Working towards self-sufficiency is hard work, and layers of difficulty are added to financial management as a newcomer to the U.S. and its financial systems and processes.
“Many immigrant communities don’t keep or organize financial assets through banks,” says Wendland of ACRS. “They may not understand complicated tax codes and have a hard time finding qualified, low-cost tax preparation assistants who can speak their language.”
With KeyBank’s help, ACRS is able to pass on practices of monthly budgeting and banking and offer free or low-cost tax preparation resources toward a greater future for clients.
“By spurring economic self-sufficiency in individuals, we anticipate newly realized prosperity to reflect upon families, neighborhoods and the business communities Key serves,” says Parent.
Income to qualify for Earned Income Tax Credit
The fiscal cliff crisis may have left some tax return dates up in the air, but one thing is certain: KeyBank will be holding its eighth annual Super Refund Saturday on Feb. 9, 2013. The event offers free one-on-one help to file personal income tax returns and helps families qualify for the Earned Income Tax Credit (EITC).
Michael Fait, Vice President, CRA Regional Compliance Manager for KeyBank, estimated that last year’s event refunded about $4 million across Key’s footprint.
In many locations across the country, Super Refund Saturday helps those who might not file because they don’t know how and can’t afford to pay for help. The event is staffed by Internal Revenue Service-certified volunteers who help participants not only file, but see if they qualify for EITC.
While Super Refund Saturday is a yearly kickoff for the free tax preparation season, other organizations offer these services in Seattle on a weekly basis. The United Way of King County will run its annual Free Tax Preparation Campaign from Jan. 15 to April 15, 2013.
Lauren McGowan, Associate Director of Ending Homelessness at United Way of King County, said United Way’s program has grown from tiny program serving 500 people to one that served 14,000 last year.
In 2012, United Way’s program returned $20.7 million in tax refunds. This year, United Way has about 17 locations that offer tax preparation sessions at different times of the week.
Since the recession hit, the population United Way serves has grown.
“People who have never had to ask for help before are asking,” McGowan said. “People who were middle class are now eligible for the EITC.”
Like the KeyBank event, this program also helps people determine eligibility for the EITC.
The EITC is a refundable tax credit for low- and moderate-income individuals and families. When the credit exceeds the amount of taxes owed, those who qualify for the credit receive a tax refund.
“This program is the largest cash assistance program targeted at low-income families in the country,” Fait said. “It’s a really good program that helps people make ends meet for people in this bracket.”
While beneficial, qualifying for the EITC isn’t always the easiest process.
“It’s difficult to do these taxes and to determine eligibility for EITC,” Fait said. “You have to make 20 separate determinations to see if you qualify.”
Christina Young has been participating in the Super Refund Saturday event at the Goodwill in Tacoma, Wash., for years.
“Since it was free to the public, I pretty much jumped on it,” Young said.
Young said the volunteers were helpful and gave her information she didn’t know about before. She said the event is important because many other tax preparation services charge participants a fee.
“There are a lot of situations where people don’t get the refund,” Young said. “[Super Refund Saturday] is very helpful because not everybody can afford the cost.”
Fait said he thought the largest challenge in filing income tax returns is cost, but there are others.
“I think language can be a barrier,” Fait said. “In these lower and moderate-income communities, there is a lot of diversity.”
In response, KeyBank will have interpreters at Super Refund Saturday to ameliorate the language barrier.
Fait also noted that the tax laws are always changing, and they can be hard to keep track of. This year, tax refunds may be delayed due to the fiscal cliff crisis resolved Jan. 1. The IRS now has to issue tax forms based on the revised laws, which could delay the start of the tax-filing season. It hasn’t yet been announced when the IRS will start accepting tax returns.
CNN reported that many of the people looking to file returns early are “low-income families who file for the earned income tax credit.”
Fait said the Feb. 9 event is part of KeyBank’s overall strategy to work with local agencies to help low- to moderate-income families manage their finances and plan for their future.