In 2023, on average, families received $2,212 from the federal Earned Income Tax Credit (EITC) and $714 from the Working Families Tax Credit (WFTC), for a $2,926 average cash boost. In total, the federal EITC provided a $779 million total boost to Washington state’s economy in 2023, and the Working Families Tax Credit added an additional $116 million, for an $895 million total boost.
If every eligible household claimed their credits, the state economy would see an additional boost of over $105 million from the WFTC and $210 million from the EITC – for a total investment of over 1.2 billion, directly into the pockets of families.
Immigrant families who use an Individual Tax Identification Number (ITIN) to pay taxes, and who are excluded from the federal EITC, were able to claim the boost from the WFTC for an average boost of $714. In Washington, over 251,000 children benefited from the Working Families Tax Credit in 2023.
Less than half of eligible households claimed their WFTC last year – leaving thousands of dollars on the table for our local economies. However, a time extension put in place last year will allow people to claim their credit for up to three years.
Research shows that the investment of tax credits for low-income families is amplified. For every $1 people get back, $2 is put back into our local economy.
However, 29% of eligible families miss out on the EITC – and last year, only 41% of eligible people claimed their Working Families Tax Credit.
Essential programs like VITA provide free tax prep in Washington state to help make sure every Washingtonian can get their boost. United Way of King County provides free tax prep in person, or people can go to www.myfreetaxes.com for free online tax preparation. Last year, lawmakers extended the time people have to claim their credit to three years, so Washingtonians who missed out can claim the WFTC for last year as well.
Lawmakers can expand the Working Families Tax Credit for young adults and seniors without kids this legislative session
An arbitrary age restriction limits the impact of the WFTC for the lowest-income households in Washington. Lawmakers have the opportunity to expand the WFTC for low-income seniors and young adults without kids this legislative session by passing House Bill 1075. This expansion would add 114,000 eligible households and would expand the WFTC by 30%, by making sure working grandparents and young adults with low incomes can benefit. Learn more about the impact of HB 1075 in this fact sheet.
“As a young person, I experienced homelessness, and I still don’t have much support on my path to financial independence. I’m 20, so I’m not able to claim the credit. If the age restriction was removed, I would be able to claim the $300 boost, which would help me pay for rent and groceries. I could invest in my own future,” said Mayauna Renea, a member of MockingBird Society’s Youth Advocacy Team.
Representative My-Linh Thai, who is sponsoring the bill, had this to say about the impact of the credit: “The Working Families Tax Credit is a historic investment in the people of Washington. Young people without kids, who are working and building a life for themselves, should not be excluded from accessing the Working Families Tax Credit. The same for working seniors with low incomes, who are experiencing poverty at higher and higher levels. House Bill 1075 will fix this unjust exclusion and ensure that many more people in Washington who need it can access this cash boost.”
More than half of young adults in Washington state do not have sufficient income to meet their basic needs. Seniors also continue to struggle to make ends meet, and more seniors are working now than at any time in the last 25 years. Rural seniors of color experience poverty at disproportionate levels; almost one in three Black seniors, and nearly one in six Latinx seniors in rural Washington experience poverty.
Take action to support the WFTC expansion at www.wataxcredit.org/advocate.