CHICAGO, Ill. (WAND)– For the second year in a row, low-to-moderate-income working families in Illinois will not have unpaid fines deducted from their state income tax refunds, according to Illinois Comptroller Susana A. Mendoza.
As Illinois continues to struggle against COVID-19, Comptroller Mendoza announced the up coming changes.
“A year ago, we had hoped the world would be further along in the fight against COVID-19. Unfortunately, we all know that is not the case,” Comptroller Mendoza said. “Again this year, families on the financial edge are counting on their state income tax refunds to pay bills they have been putting off as COVID caused hardships.”
More than 50,000 families who qualified for the Earned Income Tax Credit last year, were given access to an estimated $18 million that would have been otherwise intercepted due to the suspension of collecting fines.
“Extending this program another year means more low-income Illinoisans will keep their full tax refunds – getting them cash at a critical time. This will help underserved communities, who are disproportionately communities of color, weather the ongoing pandemic as many households continue to struggle to pay for basic needs,” said Jane Doyle, Policy & Communication Associate, Woodstock Institute.
“The pandemic upended the lives of Illinois families across the state, many of whom were already struggling to make ends meet,” said John Bouman, Director, Legal Action Chicago. “Comptroller Mendoza’s decision will help these families rebuild stability and will especially provide much-needed relief to low-income families of color. We hope this decision lays the groundwork for further, lasting changes to support Illinois families.”
Nearly 11 years ago, cities around the state were granted the right to contract with the the Comptroller’s Office to withhold unpaid traffic and parking ticket fines — as well as other court judgments — from state income tax returns, thanks to the Illinois General Assembly. Those collections were then sent to local governments through the Comptroller’s Office.
The Comptroller has performed that function for other state agencies, by doing such things like garnishing unpaid child support. These garnishments will continue to be withheld and passed on to the custodial parent.
As of two years ago, Comptroller Mendoza announced her Office would no longer withhold unpaid red-light camera ticket fines from taxpayers’ income tax refunds.
The decision came after corruption was uncovered in the red-light camera industry resulting in indictments, and reports of connections that government officials got a cut of those fines.
These fines disproportionately impact low-income families with more than 90% of red-light camera tickets in many jurisdictions are not for running through red lights, but rather for failing to make a full stop during a legal right turn on red.
Officials say it resulted in a net drop of nearly 87,000 annual claims against residents that would have resulted in income tax withholdings.
This tax year, the Comptroller’s Office is not offsetting state tax refunds going to families or individuals qualified for the state EITC, which is a widely accepted standard for determining who is considered low or moderate income.
For the current tax year (2021), qualified individuals include a family of four, consisting of a single parent with three children, earning $57,414 a year or less, as well as a single person earning $21,430 a year or less.
According to officials families benefitting from this policy change are, by definition, “working class.” If you do not earn income and file a tax return, this policy will not affect you.
Here are a few things the Comptroller’s actions do NOT do:
- This policy does not eliminate fines, but rather defers collections to help people struggling through this pandemic. This is not an amnesty. The Comptroller’s Office does not have the authority to forgive debt.
- People still have a legal obligation to pay traffic and parking tickets and other fines. Cities can hire private collectors to collect these unpaid obligations, so the Comptroller’s Office encourages people to pay those fines.
- At this point, the Comptroller’s Office does not expect to extend the suspension beyond this year.
