BOSTON--(BUSINESS WIRE)--Commonwealth, a national nonprofit building financial security and opportunity through systemic change, today announced the ARPA Access Initiative, funded by JPMorgan Chase, Prudential Foundation, The Rockefeller Foundation and the W.K. Kellogg Foundation. The fundamental changes to the tax code included in the American Rescue Plan Act of 2021 (ARPA) present a monumental opportunity to advance the financial security of financially vulnerable American families. On July 15, 2021, the IRS will begin monthly payments of the advance child tax credit, continuing through December 2021.
Between expanded tax credits, additional stimulus payments, and government aid, a Commonwealth analysis estimates that millions of low-earning households with children could easily see up to $10,000 or more of new income in 2021 and early 2022, with periodic payments beginning in mid-July. As part of the Initiative, the organization launched a new website, taxtimehub.org, to provide updates, messaging and other data to help families learn about and maximize the impact of these payments.
“ARPA presents a historic opportunity for many low- and moderate-income households to build essential short-term savings, long-term savings – especially for kids – or both,” said Commonwealth Co-Founder and Executive Director Timothy Flacke. “Those that employ or provide financial services to these households stand to benefit by doing all they can to drive awareness of these unprecedented tax credits, ensure access to quality savings tools and employee benefits, and generally support workers and customers in their efforts to use this moment to build financial security.”
Through this Initiative, Commonwealth and its partners, Neighborhood Trust Financial Partners, and SaverLife, are working to create a rapid response coalition to ensure ARPA benefits as many low- and moderate-income Americans as possible by building awareness and driving action among organizations that serve low- and moderate-income people.
Late last year, Commonwealth sounded the alarm on a potential tax time crisis for millions of low-income working families who rely on refundable tax credits and whose eligibility is based on earned income, such as the Earned Income Tax Credit and the Child Tax Credit. With widespread unemployment in 2020 due to the pandemic, many workers were at risk of receiving refunds of up to 80% less than expected.
Commonwealth joined policy efforts that led Congress to enact a lookback provision in December 2020, allowing filers who earned less in 2020 to use their previous year’s earned income for calculating tax credits. This change most impacted working households with children and annual incomes of between $15,000 and $30,000, in which families of color are overrepresented.
Commonwealth’s first rapid reaction campaign with partners Neighborhood Trust Financial Partners and SaverLife clearly communicated the changes in the tax credits to the most vulnerable families. The campaign equipped hundreds of organizations and firms to reach millions of families that were eligible for the tax credits through messaging outreach and press. These families were able to maximize billions of dollars in tax credits and refunds.
About Commonwealth
Commonwealth is a national nonprofit building financial security and opportunity for financially vulnerable people through innovation and partnerships to change systems. Black, Latinx and Female-led households disproportionately experience financial insecurity due in large part to longstanding, systemic racism and gender discrimination. Addressing these issues is critical to Commonwealth’s work of making wealth possible for all. Commonwealth’s collaborations with consumers, the financial services industry, fintechs, employers, policymakers and mission-driven organizations result in solutions that are grounded in real life and based on a deep understanding of financially vulnerable people. Commonwealth has designed effective innovations, products, and policies enabling over 1 million people to accumulate more than $4 billion in savings. For more information, visit buildcommonwealth.org.
