Newark residents who took advantage of a free tax preparation program for low-income families in the city collected $13 million in total tax refunds in 2018, up from $10 million the previous year.
The program, Newark Free-Tax-Prep, was an initiative among Newark Asset Building Coalition (NABC), the City of Newark, Prudential Financial and Citi Community Development, which worked with the United Way of Essex & West Hudson to raise awareness in the community.
The program piggybacked on the Volunteer Income Tax Assistance (VITA) program, an existing federal program that provides free tax services to people who earn less than $54,000 annually.
This year, more than 8,400 returns were filed by VITA tax counselors through Newark Free-Tax-Prep, an increase of 700 from last year. The program helped Newark residents collect close to $6 million in Earned Income Tax Credits and save another $1.7 million in tax-preparation fees.
The EITC is one of the most effective anti-poverty tools for working families, yet the IRS reports that one in five eligible people do not claim it.
“For eligible New Jersey workers, free tax preparation and access to the Earned Income Tax Credit helps to provide vital cash infusion,” said Gregory Schiefelbein, New York Tri-State Market Director, Citi Community Development.
Newark Mayor Ras J. Baraka praised United Way and Newark Asset Building Coalition partners for the effort.
“This is money that they are now able to put back into our local economy,” Baraka said. “Whether it is fighting for a living wage for all, working with our anchor institutions to increase job opportunities for Newarkers, or supporting the success of local entrepreneurs and Newark small businesses, my administration is committed to an inclusive local economy that puts our residents and business owners first.”
United Way of Essex & West Hudson President & CEO Catherine P. Wilson said helping residents get the most from filing taxes helps pay bills, get out of debt and save for the future.
“Next year, we are committing all of our available resources to helping connect even more Newark residents with our trusted and professional free tax prep services because working families in Newark deserve to get every penny of their hard-earned refund,” Wilson said.
United Way worked with key Newark-based stakeholders, including New Jersey Citizen Action, New Jersey Institute for Social Justice, Newark Alliance, Prudential, La Casa De Don Pedro, Urban League of Essex County, and New Community Corporation to raise awareness of the free tax preparation program.
Kimberly Ostrowski, vice president, corporate giving, Prudential Financial, said the Newark-based company is proud to partner with so many community organizations to help Newark residents access such a critical service.
“We’re committed to making financial security a reality for all people,” Ostrowski said. “Supporting programs like Newark-Free Tax Prep increases household income for more Newark residents and brings needed stimulus to the Newark economy.”
Phyllis Salowe-Kaye, Executive Director New Jersey Citizen Action, the free tax program ensures that no money is left on the table or paid to predatory tax preparers.
“These refunds provide the opportunity for families to catch up on bills, provide for their families and save for emergencies or their future,” Salowe-Kaye said. “These hard-earned dollars are re-invested back into the City of Newark in local supermarkets, shops and other small businesses. A win-win situation for all.”
NABC works to promote financial independence and stability for Newarkers, and provide them with financial education, access to wealth-building programs, and extended services around personal finance. NABC receives support from Prudential, in collaboration with Citi Community Development.