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Mar 17, 2010

CFED Self-Employment Tax Initiative Wins 2010 Community Reinvestment Award

Washington. D.C. — The Self-Employment Tax Initiative (SETI), an initiative of the national nonprofit, Corporation for Enterprise Development (CFED), was recognized for its product innovation – using the annual income tax filing process to deliver business development services to low-income entrepreneurs – during the 2010 National Interagency Community Reinvestment Conference in New Orleans. The Citi Foundation received a 2010 Community Reinvestment Award for its support SETI. The Community Investment Award is presented to financial institutions that advance innovative solutions to the economic challenges facing lower-income communities.

While self-employment and microenterprise have had tremendous success in emerging markets around the world, practitioners in the U.S. have been unable to attain the same degree of scale and impact as their global peers. The SETI program provides a new model for increasing outreach to U.S.-based micro-entrepreneurs who lack access to or cannot afford the financial advice and business development services they need to grow their enterprises.

During the 2007, 2008 and 2009 tax seasons, the SETI program partnered with 31 community-based organizations in 23 states who collectively served over 20,000 low‐ to moderate‐income self‐ employed tax filers, saving them over $2.1 million in tax preparation fees and providing $14 million in capital to 9,600 of these filers through the earned-income tax credit. Of these filers, 44% had no formal income beyond self‐employment and about half reported adjusted gross income of less than $40,000. In the current 2009/2010 tax season, the SETI program expects to serve over 13,000 disadvantaged self‐employed businesses, many of who will be eligible for the newly implemented Making Work Pay tax credit as well.

“SETI aims to accelerate the potential impact of the tax code to build up thousands and even millions of small and growing businesses, said Andrea Levere, President of CFED. “We are so pleased to have the Citi Foundation’s strong leadership and investment in helping CFED take this innovation to meaningful scale.”

"We are thrilled to support CFED’s innovative SETI program which has successfully seized the opportunity to use the annual tax preparation process as a “teachable moment” providing thousands of entrepreneurs with access to capital, training, and business development services they need to successfully manage and grow their enterprises, said Brandee McHale, Director of Programs for the Citi Foundation.”

To learn more about CFED’s Self-Employment Tax Initiative, please visit www.cfed.org/programs/seti.

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CFED expands economic opportunity by helping Americans start and grow businesses, go to college, own a home and save for their children’s and own economic futures. We identify promising ideas, test and refine them in communities to find out what works, craft policies and products to help good ideas reach scale, and develop partnerships to promote lasting change. We bring together community practice, public policy and private markets in new and effective ways to achieve greater economic impact.

Established in 1979 as the Corporation for Enterprise Development, CFED works nationally and internationally through its offices in Washington, DC; Durham, North Carolina; and San Francisco, California.