The Department of Revenue told the House Finance Committee that Year 2 of Washington’s Working Families Tax Credit produced more refunds, faster processing times, and expanded outreach that increased participation.

Steve Ewing, legislative and external affairs liaison for the Department of Revenue, said the program—which provides refundable credits for low- and moderate-income households patterned on the federal earned-income tax credit—saw a 22% increase in refunds year over year and a 28% increase in dollars refunded in 2024. Ewing said about 80% of refunds went to households with children and the average refund was roughly $750.

Ewing highlighted administrative and outreach changes that helped: onboarding four new modernized e-file (MEF) vendors (bringing the total to 16), a $5 million community outreach grant program with 27 grantees, a multimedia marketing campaign, and partnerships with state agencies that sent mailings or postcards to potential eligible households—DSHS and HCA alone sent hundreds of thousands of mailings on DOR’s behalf.

DOR added prepaid debit cards as a payment option to reduce check-cashing friction, began offering Spanish written correspondence, and reported two new integrations planned for 2025: onboarding TurboTax as a MEF vendor and deeper integration with the IRS direct-file pilot with an aim to fully integrate the state credit into direct file by 2026.

Ewing said the 2023 Legislature’s expansion to permit filing for the three prior years had an immediate effect: DOR saw roughly 18,000 additional applications and roughly $13,000,000 more in refunds tied to the three-year expansion. He also said about two-thirds of refunds were paid within 30 days in 2024, an improvement from year one.

DOR intends to continue outreach, vendor onboarding, and efforts to share data with agencies that serve eligible populations to increase participation in 2025.