Free tax service nets refunds for low-wage workers
Preparing your taxes can be frustrating. In fact, many taxpayers who are entitled to refunds don't even file a tax return. And many Americans simply cannot afford professional tax preparation services. A University of Wisconsin-Extension partnership provides free tax-preparation assistance.
This spring, volunteers at the South Madison Volunteer Income Tax Assistance (VITA) Partnership Project assisted nearly 4,500 low-income taxpayers in preparing their taxes, helping Dane County families obtain an estimated $6 million in federal and state refunds.
Diverse partners
Cooperative Extension educators work closely on this initiative with a diverse team of partners that includes the Internal Revenue Service (IRS), Wisconsin Department of Revenue, AARP Tax Counseling for the Elderly Program (TCE), UW-Madison, Centro Hispano and the United Refugee Service. Each partner provides volunteers and/or resources that contribute to the success of the project.
Making tax time easier
By offering free, confidential tax assistance, the VITA program makes tax time easier for low-wage workers, older adults and persons with disabilities. Many who seek help from the VITA program discover that they are eligible for federal or state tax credits, such as the Earned Income Tax Credit (EITC) or the Homestead Credit.
There are several VITA sites throughout Wisconsin, located mainly in schools, community centers or public libraries. Volunteers trained by the IRS and the Wisconsin Department of Revenue prepare basic income-tax returns, and many sites also offer free electronic filing.
Community volunteers
The South Madison VITA program's success depends on trained community volunteers, including Department of Revenue staff, retired Certified Public Accountants and UW-Madison students.
"About one-third of the volunteer work force is made up of UW-Madison students in accounting, law and consumer science," says Michael Gutter, UW-Madison/Extension family financial management specialist and professor of consumer science. "The Morgridge Center for Public Service has played a key leadership role, as well as students from the Financial Occupations Club for University Students (FOCUS) in the UW School of Human Ecology."
Steady growth
Pat Ludeman, a UW-Extension family living educator in Dane County, was instrumental in establishing the VITA site in Madison through formation of partnership in 2002. The program has grown steadily ever since.
"In 2005, nearly 4,500 returns were completed at the South Madison VITA site," says Ludeman. "This partnership is unique in its strong service-learning component with the Madison campus. In addition, this year we were able to connect people through the Access program (a Web-based pre-screening tool) to food stamps and other services for which they might be eligible.
"Collectively, an estimated $14 to $15 million in federal and state tax refunds has been received in Dane County in the four years since the program began," Ludeman adds.
Volunteers Paul Fishkin of AARP (standing) and UW-Madison student Karen Rountree check one of the nearly 4,500 tax forms prepared through the South Madison Volunteer Income Tax Assistance (VITA) Partnership. Photo by JIM GILL
Empowering low-income families
UW-Extension Dane County hosts the VITA site in Villager Mall on Park Street in Madison, where several community agencies offer services to local families. Also at this location, the Campus Community Partnership brings together educational resources from the UW-Madison, UW-Extension Dane County, Edgewood College and Madison Area Technical College. In addition, UW-Extension Dane County has established a new Financial Education Center at the mall, providing low- to moderate-income families with a one-stop shop for financial information, classes and services.
The VITA program's goal is to empower all low-income working families to get the credits and deductions for which they are eligible, which in turn promotes their ability to save and manage their money. In Dane County and at other VITA sites in Wisconsin, these efforts are paying off in very real terms for individuals, families and communities. —Jo Futrell
For more information about VITA: www.dor.state.wi.us/faqs/pcs/vita.html, (800) 829-1040
South Madison VITA Taxpayers
- 55% reported income under $20,000; only 6% reported an income of more than $40,000
- 63.4% said they plan to use their tax refund to keep up on bills
- 33.8% said they are currently saving money in some sort of account, including retirement accounts