The Department of Revenue told the House Finance Committee on Jan. 14 that year two of Washington’s Working Families Tax Credit produced more refunds, faster processing and expanded outreach while the agency prepares for further automation and vendor onboarding.

Steve Ewing, legislative and external affairs liaison for DOR, said applications and refunded dollars increased by 22% and 28% respectively from year one to year two. DOR estimates roughly 350,000 households are eligible for the credit. Ewing said about 80% of refunds in 2024 went to households with children and the average refund per application was about $750.

DOR cited outreach and administrative changes that improved timeliness: two-thirds of refunds were issued in under 30 days in year two (up from roughly half in year one), the department onboarded four new MEF (modernized e-file) vendors, and the agency distributed $5 million in community outreach grants last year. DOR also added prepaid debit card delivery as an option, began sending Spanish correspondence for written notices, and worked with agencies such as DSHS and the Health Care Authority to reach potential beneficiaries via mailings.

Ewing described the statutory expansion enacted in 2023 (House Bill 1477) that allowed retroactive claims for up to three prior years and welcomed the resulting increase in applications and refunded dollars. DOR plans to onboard TurboTax as an MEF vendor for the coming filing season and to continue efforts to integrate the credit into the IRS’s Direct File pilot (aiming for fuller integration by the 2026 filing season).

Committee members asked clarifying questions about refund distributions, ITIN holders and program design. DOR said about 9% of refunds in 2024 went to households with at least one ITIN-holder and that ITIN recipients commonly are self-employed or contract workers. DOR said many outreach successes were driven by partnerships with state agencies that were able to send mailers to potential beneficiaries.