New California tax break coming for some workers

Posted at 5:27 PM, Dec 04, 2015
and last updated 2015-12-04 20:27:36-05

Hundreds of thousands of Californians can expect a bigger check from the state next year, and many don't even know it.

Terri Honda owns an ice cream truck, but business isn't always sweet.

"I don't make that much money," she said.

On some days, she only sells $60 worth of ice cream.

Honda also has an employer, and she makes a little more money by working part-time for a caterer.

If ice cream sales stay soft, it means she could qualify for a new state tax credit meant for the lowest income earners.

"It would do a lot for me, for my living and everything. That would be great, I like that," Honda said.

This year, California is introducing its version of the Earned Income Tax Credit, something the federal government has offered for years.

The credit means some Californians earning up to about $14,000 a year could receive a bigger tax refund check. There are free tax prep services for people who earn less than $54,000 a year, and they are trained to help people get the new credit.

How much someone can get back depends on how much they earn and how many kids they have. Someone with no kids may get $200, but someone with three kids could get an extra $2,500.

That's in addition to the Federal Earned Income Tax Credit, which Honda could qualify for both as a business owner and an employee.

"I wish I could get all my money back," she said, laughing.

Now that would be one sweet deal.