GET THE FACTS

The Problems Facing Californians Require Data-Driven Solutions

Last year, the CalETIC and YCTC directed more than $1.3 billion in cash payments to nearly 3.5 million families and individuals earning about $31,000 or less a year.

  • CalEITC - provides up to $3,529 in cash back for families with children.

  • YCTC - provides $1,117 in additional cash back for CalEITC filers who have a child under the age of 6. 


Tax Credits Deliver Racial Equity and Benefit Californias Across the State. 

  • Families in every legislative district benefit from the CalEITC and YCTC, putting dollars back into the communities when they shop for groceries or diapers. 

  • Around 3 in 4 Californians eligible for the CalEITC are people of color, including about half who are Latinx

  • More than 8 in 10 Californians likely eligible for the YCTC are people of color, about two-thirds of whom are Latinx. 

  • These credits help build an economy that works for all Californians, by lifting up families — especially Black and Brown communities — who need the most support.


Free Tax Prep Programs Provide Access to Vital Anti-Poverty Tax Credits

Free tax help through VITA (Volunteer Income Tax Assistance) is crucial to ensure families can claim the tax credits they’ve earned. VITA programs and trusted, local community-based organizations engage in outreach with target populations and play a crucial role in helping families access their cash. With the money saved on tax filing, Californians could afford to cover the cost of gas, groceries, and other basic needs.

  • VITA volunteers are IRS-certified and have 94% accuracy, which is higher than any other category of tax preparation services, including CPAs and major paid tax prep corporations.

  • In 2023 alone, we estimate that households saved more than $30 million in the year 2023 by using FTPA services. 

  • For every $1 invested in tax credits, $2.00 is invested in local economies. Since Californians received $1.3 billion in tax credits last year, that meant $2.6 billion went back into local economies throughout the state, in part thanks to VITA volunteers who provided free tax help for families to claim all the tax credits they were eligible for at no cost to them.

  • In 2017, the California Budget & Policy Center found that only 10 percent of Latinos surveyed had heard of the CalEITC. With community powered outreach, a policy brief put out by the Public Policy Institute of California in 2023 found that Latinos communities had claimed the CalEITC at higher rates than other communities of color, underscoring the importance of supporting ongoing education and outreach. 

  • We work with partners to create outreach opportunities without barriers, from food banks to farmers markets to schools. Our materials and messengers reach people where they are in the languages spoken in the community.


Policy Choices Led to Soaring Poverty Rates for Children, Black and Latinx Communities:

According to the California Budget & Policy Center recent report on the Supplemental Poverty Measure:

  • The child poverty rate more than doubled - from 7.5% in 2021 to 16.8% in 2022 - after Congress refused to renew the enhanced federal Child Tax Credit. 

  • California’s poverty rate surged to 16.4% in 2022, up from 11.0% in the previous year following the expiration of the federal Child Tax Credit expansion. 

  • Poverty increased drastically for Black Californians, nearly doubling from 9.5% in 2021 to a staggering 18.6% in 2022. Similarly, poverty spiked for Latinx Californians, jumping from 12.6% in 2021 to 21.6% in 2022.

  • Nearly 1 in 5 Black Californians and more than 1 in 5 Latinx Californians were thrust back into poverty as pandemic era policies and financial supports like the expanded federal Child Tax Credit expired.


Californians Struggle to Afford the Real Costs of Living:

According to United Ways of California’s 2023 Real Cost Measure study:

  • More than one in three households — over 3.7 million (34%) — do not earn sufficient income to meet basic needs in California; 97% of which have at least one working adult.

  • 7 in 10 single mothers in California, over 576,000 households, fall below the Real Cost Measure.

  • 51% of Latino households fall below the Real Cost Measure compared to 45% of African American households, 30% of Asian American households, and 23% of White households.

  • More than half of households with Young Children Struggle — 54% of households in California with children under the age of six fall below the Real Cost Measure.