City tax service boosts refunds
Free assistance helps 18K more residents claim income credit
With help from Detroit’s free tax preparation services, Moriah Allen, 25, could buy a car, pay off some debts, fill her fridge and feel secure during her unpaid maternity leave.
Allen is one of 92,403 Detroiters who filed for Earned Income Tax Credit refunds in the 2016-17 tax season. She said she earned back more this year, with help from volunteers, than last year, when she did her taxes herself.
The city of Detroit credited the 5-month-old initiative for the additional 18,150 who filed for refunds and claimed on average $4,083.75, reaching a grand total of $74.1 million in refunds from state and federal governments.
“Individuals can sow back into the economy, by paying mortgages, buying transportation and putting food on the table,” said Lisa Howze, Detroit director of legislative affairs and EITC campaign coordinator.
Modeled on a similar initiative in New York, the program was implemented to connect Detroiters with $80 million in annual unclaimed tax refunds.
Detroit, however, did four times better than New York City in its first year of implementation, said Rose Gill Hearn, principal of Bloomberg Associates.
“There are many amazing things happening in Detroit,” Gill Hearn said. “This is now one of them.”
The city partnered with the Accounting Aid Society, United Way for Southeastern Michigan and Bloomberg Associates on the initiative.
Detroiters could file remotely through a virtual portal called “Drop and Go” that United Way set up or make appointments with AAS volunteers, who filed taxes for Detroiters so they could maximize their returns.
Kathleen Hatke Aro, president of the Accounting Aid Society, joked that tax season is never over for accountants, but she encouraged Detroiters to keep filing. She said it’s still possible to work with volunteers at any AAS sites.
“We hope to see some people in our offices this summer,” she said.
Delores Jones, a street maintenance driver for the Department of Public Works, moonlights as a volunteer tax preparer.
“This summer, I need to see those W-2s,” she said. “Yes, y’all, this is really free tax preparation.”
The city also announced the U.S. Bureau of Labor Statistics’ unemployment numbers for May 2017. Per the bureau, Detroit’s unemployment rate in May was 7.5 percent, down from 8.4 percent in April. It is the lowest the city has seen since December 2000, when the jobless rate was 6.1 percent.
In those two months, 2,400 Detroiters took jobs, bringing the total of new employed residents up to 18,000 since January 2014, when the city’s unemployment rate was 17.6 percent.
Growing industries in Detroit are information technology, advanced manufacturing, construction and skilled trades, health care and retail, hospitality and entertainment, said Jeff Donofrio, director of workforce development.
“Detroit is outpacing the state and the nation,” Donofrio said. “But there are still a lot of challenges and still a lot of work to be done.”
To encourage this growth, Donofrio said the city has built 11 programs to remove barriers like transportation, child care and a lack of hard and soft skills to connect job seekers with employers.
One such program is a tech hire program that teaches coding, web development and network administration. Others improve literacy, improve pathways after K-12 education and teach soft skills like crisis and conflict management and appropriate workplace behavior.
For more information, he said visit detroitatwork.com, a website that “cuts through the nose for job seekers and employers.”
Detroit unemployment fell to 7.5 percent in May, the city’s lowest rate since December 2000.