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Abstract
This dissertation offers a comprehensive exploration into the tax filing behaviors of low-income U.S. households, emphasizing the nuances surrounding the Earned Income Tax Credit (EITC). The research consists of three distinct but interconnected studies. The first essay emphasizes individual factors drawn from the Survey of Consumer Finance (SCF) data (2001-2019), centering on the limited resources individuals possess, particularly in terms of financial inclusion and access to financial information and social benefits. Individuals with limited resources frequently choose not to file, potentially forgoing beneficial returns. The second evaluates county-level variations in EITC claiming rates. Despite the significant advantages of the EITC, about one-fifth of eligible taxpayers don't claim it. The study reveals that low-income counties often underutilize the EITC, with a direct correlation between income levels and EITC claims. EITC claim rates are influenced by housing instability, access to services like VITA, household composition, and demographic factors. Also, the study emphasizes the pivotal role of Volunteer Income Tax Assistance (VITA) sites in increasing EITC participation. In line with the study, the third study examines the alignment between VITA site locations and high-need areas, stressing a significant disparity. The research indicates that while VITA sites facilitate EITC claims and offer community advantages, they are not usually situated in high-need areas. The study emphasizes the need for strategic placement of VITA sites to maximize tax benefits, calling for detailed policy initiatives.
The research suggests a need for strategic reevaluation of VITA locations and more targeted policies to maximize EITC claims among eligible households. By taking into account both individual and community factors, the dissertation has some important implications for policymakers and practitioners: the strategic location of tax assistance services and tailored outreach can profoundly affect EITC claims, indicating avenues to enhance the financial well-being of low-income households.