Small Investment, Big Difference: Mapping the impact of an Ohio Earned Income Tax Credit

April 10th, 2013
   

The federal Earned Income Tax Credit does more than any other program to keep working families out of poverty. As this map shows, the EITC brings hundreds of millions of dollars to Ohio each year, benefiting families and communities in every county.

The map also provides estimates of the benefits a state EITC would bring to each county, at both 10 percent and 20 percent of the federal credit. In 86 counties, at least 10 percent of households would claim a state credit. At 20 percent, a credit would provide the average recipient with about $420. For more on the federal program and an Ohio credit to supplement it, see Small Investment, Big Difference: How an Ohio Earned Income Tax Credit would help working families.

Notes on the data

Data are from tax year 2010, collected from returns filed in 2011. Policy Matters Ohio analyzed data provided by the Internal Revenue Service to the Brookings Institution. Data from 2009 and 2010 are not comparable to past years because the IRS changed the way the data are reported.

  • Total households refer to the number of tax returns filed in a county.
  • Total EITC households refer to the number of EITC claims filed in a county.
  • EITC percentage of all households refers to the number of EITC claims as a percentage of all households filing taxes.
  • Federal EITC amount is the total amount of EITC dollars refunded to each county.
  • Average federal EITC amount is the amount of EITC dollars refunded divided by the number of EITC recipients.
  • Percentage of EITC households using paid tax preparation refers to EITC claiming households who use paid tax preparation to do their taxes. This does not include those who pay for a computer software or online-based platform for tax preparation.
  • Percentage of EITC households purchasing refund settlement products refer to tax refund anticipation loans (RALs) and refund anticipation checks (RACs), which are brokered by a paid tax preparer and used to pay for the preparation. In recent years, RALs are less available due to newer regulation and that the IRS is no longer providing the debt indicator, which allowed paid preparers and lenders to know if the IRS was releasing the refund. Consequently, RACs make up a larger share of the refund settlement market.
  • State EITC estimates are calculated by taking 10 and 20 percent of the of the federal credit amounts for each county.