Press Release: President Clinton Urges Eligible Katrina-Affected Residents to Claim the Earned Income Tax Credit

President Clinton today urged eligible Gulf Coast residents to apply for the federal Earned Income Tax Credit (EITC) by taking advantage of a special Internal Revenue Service (IRS) filing extension for those impacted by Hurricane Katrina. Earlier this year, the Clinton Foundation launched the EITC Awareness Program to help working families in hurricane ravaged regions get the tax credits that they are entitled to.

“For victims of Katrina, EITC is a powerful tool to help rebuild lives in the short-term and realize big dreams in the long-term,” said President Clinton. “We can put more money in people’s pockets today, simply by spreading the word about this credit and helping families with tax preparation. We’re focusing on those who lost so much after Hurricane Katrina, because this credit can be the difference between financial hardship and rebuilding a better life.”

The Internal Revenue Service is providing additional time to file 2004 and 2005 individual tax returns through October 16, 2006, for certain affected taxpayers hit hardest by Hurricane Katrina. The additional time to file individual income tax returns applies only for affected taxpayers in 31 Louisiana parishes, 49 Mississippi counties and 11 Alabama counties. To ensure that they receive the relief to which they are entitled, affected taxpayers should mark “Hurricane Katrina” in red ink on the top of their returns. In addition, affected taxpayers may identify themselves as eligible for relief by calling the IRS Disaster Hotline at (866) 562-5227. Taxpayers can also call this number for more information or to find out if they are eligible for the extension.

The Clinton Foundation’s EITC Awareness Program is working collaboratively with and helping to support the ACORN Institute’s Katrina Benefits Access Project and Operation HOPE’s Project Restore HOPE. ACORN ran mobile outreach and tax filing units in ten cities either in the hurricane affected region or with large numbers of Katrina survivors. Companies such as Deutsche Bank, E*Trade Financial, The First American Corporation, and H&R Block, supported Project Restore HOPE’s efforts providing financial counseling services, including EITC outreach and tax filing, to thousands of Gulf Coast families. H&R Block provided free tax preparation to 5,000 Project Restore HOPE clients and unlimited EITC filings. Since February, the Clinton Foundation partnership has resulted in nearly $10 million in tax credits for working families in Alabama, Louisiana, and Mississippi.

During his administration, President Clinton doubled the Earned Income Tax Credit, giving more than 15 million working families a tax cut. In 1998 alone, the EITC lifted more than 4 million people – including more than 2 million children – out of poverty. In 2004, more than 21 million Americans claimed more than $39.2 billion in EITC; however, as much as $12.7 billion in EITC went unclaimed. Taxpayers who earned $35,000 or less in 2005 could get as much as $4,400 in EITC.

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