Earned Income Tax Credit Awareness Day falls on January 31 this year, and we are all excited at the prospect of its contribution to easing our finances. Did you know taxation has been around for several thousand years? Yes, even Jesus paid tax, according to the “Bible.” Tax is very important for running any country, but even more so, is a tax credit that can come in time to help pull families out of the financial crunch.
History of Earned Income Tax Credit Awareness Day
Paying Taxes is one important way of showing a deep sense of patriotism to your country, as taxes help the government to run smoothly and to be able to serve everyone better. Taxes help to ensure the management and sustainability of the roads upon which you travel, the creation of parks, libraries, and other incentives and generally fund the bulk of government policies aimed at improving citizens’ standards of living.
The first historical evidence of an organized system of taxation was in Egypt around 3000 B.C. Evidence of this has been found in several historical sources, and it was mentioned in the book of Genesis where Pharaoh was said to send out commissioners to collect one-fifth of all grain harvest as tax. Taxation has evolved ever since then to include individual income tax, corporate income tax, property tax, sales tax, payroll taxes, capital gain taxes, and more.
A tax credit is a much more recent initiative that took root in the latter part of the 20th century as a measure to ensure ease of life for poor families with many dependents by reducing their tax liabilities. It then went through many forms and reforms to this present day.
Earned Income Tax Credit is a scheme by the government to augment the average income of working-class citizens. For the U.S. it is for those earning below $56,000 per annum. Taxes for these recipients are offset, depending on their income, marital status, and the number of dependants. This initiative is the government’s way of reducing the poverty rate while increasing the standard and quality of life of citizens, by enabling low-income earners to retain more of their income to bolster their finances.
Earned Income Tax Credit Awareness Day timeline
Historical sources reveal that taxation begins in Egypt as a source of funding for the country’s treasury.
The Roman Empire levies wealth tax on citizens and people in places under their jurisdiction.
Income tax, which is levied directly on personal earnings, is introduced in Great Britain by Prime minister William Pitt, to offset the cost of the Napoleonic Wars.
President Ford signs the initiative in the U.S., and it is later expanded by President Reagan as he assumes office in 1981.
Earned Income Tax Credit Awareness Day FAQs
Must you be an income earner to receive the benefit?
Yes. Only those who are working and earning wages are entitled to receive the benefit.
Would getting Earned Income Tax Credit lower other government benefits?
No, the different benefit initiatives of the government are tailored to solve different problems. Generally, Earned Income Tax Credit doesn’t stop you from receiving other government benefits if you are due for them.
Can a worker claim the benefit if they haven’t done so for the past few years?
In the U.S and fewer other countries, workers can file for tax credit refunds for up to three years preceding the current tax year.
How to Observe Earned Income Tax Credit Awareness Day
Share on social media
Share posters, hashtags, and information about Earned Income Tax Credit so others can also benefit from the initiative. There are myriad pictures on the internet about the day that you can repost.
This is an opportunity to educate others about the processes, requirements, and how to partake in the benefits. As an individual or organization, you can make use of flyers, videos, and several other tool kits readily available.
Claim your benefits
According to the I.R.S. and Census Bureau of the U.S., only about 80% of workers eligible for the benefit claim it. If you are one of those who meet the requirement for the Earned Income Tax Credit, this is the time to begin preparing toward claiming it to ease your finances.
5 Fun Facts About Tax
It wasn’t always money
In ancient times, taxes were paid through labor, livestock, farm produce, or a part of anything or businesses the taxpayer engaged in for a living.
Einstein didn’t understand tax
The renowned physicist was quoted to have once said: "The hardest thing to understand in the world is the income tax."
Whistleblowers make money from tax
The I.R.S. in the U.S. pays whistleblowers up to 30% of the money received from taxes, penalties, and interests when they provide information about those who evade taxes.
Tax on crime
Money earned illegally is subject to tax, and purveyors of drugs and illegal substances anonymously buy and use tax stamps affixed on their containers to evade it and move their goods.
Cow flatulence tax
Countries like Ireland, Denmark, and other European Union nations tax cow owners on cow flatulence because cows’ release of methane into the atmosphere is a major source of global warming.
Why Earned Income Tax Credit Awareness Day is Important
It helps to alleviate poverty
Earned Income Tax Credit helps to alleviate poverty for low-income earners. By reducing liabilities on tax, it allows people and families who earn little to be able to have more money to spend on other things.
It has an impact on health
Reducing poverty, financial stress, and insecurity improves health. Recipients would be able to improve their lifestyles and diet through the reduction of their tax liability.
It advances equity
Earned Income Tax Credit helps to narrow the wealth gap between the rich and poor. It enables the poor to be able to focus on other opportunities to better their lives.
Earned Income Tax Credit Awareness Day dates