Option 2: Additional Income Sources

Many people turn to a high-cost loan for a large one-time expense. This section includes ways to access additional income without increasing your debts. Before turning to a loan, consider taking these steps.

Even if you missed the May deadline to file, you could still be eligible for thousands of dollars in tax refunds by filing taxes. Even if you don't normally file taxes, you can still file. There is no penalty for filing late if you don’t owe the IRS any money. File as soon as possible to get your refund. Most programs to help people file taxes for free are available from January to October.

If you have children, you may be eligible for monthly, advance payments of your Child Tax Credit. These could be as high as $300 per month through December 2021. These advance payments only cover part of the Child Tax Credit, and you can receive the rest of the credit by claiming it on your taxes in 2022. A simple filing tool is available at GetCTC.org for individuals who earn less than $12,400 a year ($24,800 for couples). However, this tool is best for people who earned little or no money this year. If you earned some money, you’ll receive more money by filing taxes.

If you haven’t received your stimulus check yet, you may claim the Recovery Rebate Credit on your taxes to receive it. Many low-income people are also eligible to receive money from the Earned Income Tax Credit (EITC). Learn if you are eligible for the EITC here.

Filing your current year taxes online and using a bank account number for direct deposit will help you get the money much more quickly. If you didn’t file taxes in the last two years but think you might be eligible for these tax credits, you can still file a paper return for those years to receive your past refunds.

• Many Americans are eligible for free, online tax-preparation services. This article explains How to File your State and Federal Taxes for Free in 2021.
• Visit GetMyPaymentIllinois.org to learn more about how to file your taxes for free, get your Recovery Rebate Credit, or how to get a higher EITC if you earned less in 2020 than in 2019. They have a hotline (888-553-9777) for people without computer access or more complicated tax questions.
• In Chicago, Ladder Up offers free tax assistance to eligible families. Ladder Up also has pro bono attorneys available for more complicated tax situations.

The federal government now has a program to reimburse the costs of funerals for deaths attributed to COVID-19 (according to the death certificate). The maximum benefit is $9,000 per burial. To be eligible, the funeral must have occurred after January 20, 2020. For more information, including required documentation, go to their website. To apply, call 844-684-6333 (multilingual services available). They are not accepting online applications.

If you are employed, ask your employer for an advance on your next paycheck. There are companies and apps that also offer this option. However, terms and fees vary widely and they can become a debt trap. At this time, there are no companies we recommend for early paycheck access.

Many churches provide financial and other assistance. For example, Catholic Charities agencies across Illinois have financial assistance programs for families regardless of religion.

Tap into your savings. Chances are you have already exhausted any money in a savings account, but you may also have retirement savings (401k, IRA, etc.). It is never ideal to deplete your savings or tap into retirement accounts, but it is one way to boost your income in a major financial emergency. There are tax consequences, and you may have to adjust how you save for retirement going forward. You may want to consult with a licensed accountant or a certified financial planner.

If you’re willing to part with an item (i.e., gold jewelry, designer clothes, or antiques) consider selling it rather than getting a pawnshop loan to avoid paying financing charges. Poshmark is a widely used app for this.