Peter Lee, left, gives an award of thanks to Rick Keller, who implemented the Earned Income Tax Credit/Volunteer Income Tax Assistance programs in Rhode Island seven years ago.

The Providence Journal / Bob Thayer

PROVIDENCE — A coalition of volunteer groups prepared tax returns this year that generated more than $2.87 million in federal and state refunds, an increase of nearly 36 percent over last year’s filing season, the group said yesterday.

The refunds — which include the earned income credit, a tax break for the working poor — went to 2,134 households, mostly in Providence, up about 41 percent from last year, the group said.

The figures were disclosed at a ceremony yesterday afternoon at John Hope Settlement House, a community center in Providence’s West End.

The returns were prepared by the Providence Volunteer Income Tax Assistance and Earned Income Tax Credit Coalition, a partnership that includes volunteer sites in the city’s Elmwood, West End, South Providence and Olneyville neighborhoods.

A key part of the campaign is to raise awareness about the earned income credit, which is the nation’s largest and most important anti-poverty program, said Peter Lee, president and chief executive officer of John Hope Settlement House.

Providence Mayor David N. Cicilline called the earned income credit program “a great economic engine” that “helps families, helps neighborhoods, [and] helps business.”

Laurie White, president of the Greater Providence Chamber of Commerce, said “Local businesses have a vested interest in supporting the local earned income tax credit program.”

Their support helps build trust and goodwill, she said. In addition, the credit can serve as a supplement to an employee’s income, she said.

And with the skyrocketing cost of fuel, the program this year has added significance, said Anthony Maione, president and chief executive officer of United Way of Rhode Island.

“This year, those funds buy oil” so that families can heat their homes in winter, he said. Money generated by the credit also helps people buy gas for their cars, he said.

Vivian Moreno, a recipient of the earned income credit, said people use money they obtain through the credit program to help pay for basics, such as utilities.

She also said that the credit “has been more important to me this year than ever before,” partly because of the rising cost of living.

Moreno, a Providence resident who also runs a volunteer tax-preparation site, said that the earned income credit program faces challenges.

For example, taxpayers who use an unskilled preparer may get less of a credit than they deserve — or they may get too great a credit and wind up being challenged later on by the Internal Revenue Service, she said.

The credit is generally available to those with earned income (essentially money from a job) of less than $40,000.

In general, the maximum credit is around $2,900 for someone with one child, or around $4,700 for someone with more than one child.

During this year’s tax-filing season, volunteers for the group prepared 2,134 returns, up from 1,510 for the same period last year, said Rick Keller, the group’s program coordinator.

Those returns generated about $2.87 million in federal and state refunds, up from about $2.11 million for the filing season last year, he said.

Nearly half of the refunds were the result of the federal and Rhode Island earned income credit, he said.

In addition, those who had their returns prepared by the Providence campaign’s volunteers this year saved themselves about $426,800 in tax preparation fees, as well as in interest they might have paid had they obtained refund anticipation loans from commercial preparers, he said.

ndowning@projo.com