Guest Post: The Benefit Bank Helps Community College Students Claim Work Supports

We’ve looked before at different ways to help students build a safety net that enables them to meet school obligations as well as personal, family, and work obligations, including financial counseling and financial literacy instruction. Today’s post from Michael Schultz, MDC VISTA, details another MDC initiative that helps connect individuals to available financial supports that could make the difference between a completed semester or an early withdrawal.

Consider this: an estimated $70 billion in work supports goes unclaimed by eligible households in the United States each year. Unbelievable, right? Community college students are often eligible for federal work supports beyond financial aid, yet lack of knowledge and barriers to access result in federally apportioned dollars going unclaimed.

Most notably, many community college students may be eligible for Supplemental Nutrition Assistance Program (SNAP), also known as food stamps. In order to be eligible for SNAP, full-time college students between the ages of 18-49 must meet at least one of the following criteria:

• They work at least 20 hours a week
• They work any number of hours in a federal or state work study program
• They are a married parent with at least one dependent under the age of 6
• They are a single parent with at least one dependent under the age of 12

Students must also meet the program’s income and asset limits that vary from state to state in terms of definitions, exemptions, and deductions.

Another work support likely available to community college students is the Earned Income Tax Credit (EITC). Available to anyone who earns income during the year, the EITC is fully refundable, meaning even households that owe no taxes can still receive the EITC as part of their refund. The greatest benefit is to households with children. The maximum credit for a household with one child is $3,094, with two children it is $5,112; with three or more children, it is $5,751. Households without children are also eligible: a single person without children, over the age of 25, and earning roughly between $6,000 and $7,500 is estimated to receive the maximum $464 tax credit. The IRS estimates that as many as 1 in 5 eligible households fail to claim the EITC. This population almost certainly includes many community college students who don’t realize they are eligible. (Check out the EITC Carolinas website, an MDC initiative, for more information.)

MDC’s Works Supports Initiative seeks to connect eligible populations, like community college students, to the federal and state benefits for which they are eligible. This national initiative uses an online service called The Benefit Bank^® (TBB) in partnership with community and faith-based organizations to help clients fill out benefit applications, e-file taxes, and complete the FAFSA. The Benefit Bank allows individuals to complete multiple applications in a user-friendly format with simple prompts and gateway questions that determine when more information is required. With TBB, a client can receive help filling out benefit or tax forms at a familiar community organization with the trusted assistance of a counselor. With confidence, knowledge of the application process, and the proper forms in hand, TBB helps to make it easier to connect low- and middle-income households to work supports.

Benefit applications can currently be completed using The Benefit Bank in ten states: Arkansas, Florida, Indiana, Kansas, Mississippi, North Carolina, Ohio, Pennsylvania, South Carolina, and Texas. Federal benefits are accessed through state agencies with states having flexibility to shape their state’s version of the program. Thus, to complete benefits applications, TBB requires partnerships with the appropriate state agencies. Affiliate partners in each state help to build the necessary partnerships with state agencies and with the community organizations whose trained counselors use TBB to serve their clients. To receive benefits, the completed applications must be accepted by the proper state agencies that then determine eligibility, including checking the paperwork and identification.

Of immediate use in all states is TBB’s Quick Check feature, a one-minute benefit screener that estimates the likelihood of eligibility for a range of benefits. Also available in all states is TBB Self Serve, a free e-File service for federal taxes paired with a FAFSA application. The key strength of TBB is its ability to take the proper information from one form and pre-populate another benefit form. For example, after completing taxes using TBB, a significant portion of the tax information on the FAFSA will already be filled in when a user completes the application. This “bundling” saves time and is kept secure within each client’s individual password-protected portal.

In a time when community college students are hard pressed to make ends meet, connecting students with financial aid and works supports can help students stay in school. The Benefit Bank makes connecting students to works supports like SNAP and the EITC that much easier.

Michael Schultz is an AmeriCorps VISTA at MDC.