People with low incomes are often entitled to special tax treatment that could lower their bills from the Internal Revenue Service. But some of these breaks, such as the earned income tax credit or child dependency rules when family members are helping out financially, are complex and create additional problems for eligible individuals.
In many cases, lower-income taxpayers who could benefit from the tax laws can't afford to hire a tax specialist for help in deciphering them. Their tax troubles are compounded if they must battle the IRS alone in resolving post-filing tax disputes.
The IRS supports several programs to help eligible lower-income taxpayers not only get their returns properly filed, but then to help individuals if they encounter any subsequent tax problems in connection with their filings. The filing assistance is free. Follow-up help is free or the providers charge only a small fee.
VITA programThe Volunteer Income Tax Assistance program, or VITA, uses community volunteers who are trained to help filers deal with the often confusing credits that are apply to low- and moderate-income taxpayers. In addition to free tax return preparation assistance, most VITA sites also offer free electronic filing.
This service is available in most cases to taxpayers with incomes of $42,000 or less.
VITA sites are generally located at community and neighborhood centers, libraries, schools, shopping malls and other convenient locations. Call (800) 829-1040 toll free to find the VITA site nearest you.
Tax Counseling for the ElderlyThe Tax Counseling for the Elderly program, or TCE, provides free tax help to people aged 60 and older. As with VITA, trained volunteers from nonprofit organizations provide free tax counseling and basic income tax return preparation for senior citizens.
As part of the IRS-sponsored TCE program, AARP offers the Tax-Aide counseling program at more than 7,000 sites nationwide during the filing season. Trained and certified AARP Tax-Aide volunteer counselors help people of low-to-middle income, with special attention to older taxpayers.
For more information on TCE, call toll free (800) 829-1040. To locate the nearest AARP Tax-Aide site, call toll free (888) 227-7669 or visit AARP's Internet site.
If you plan to take advantage of VITA or TCE services, you'll need to bring the following material, if it applies to your filing situation, with you:
What to bring
- Proof of identification.
- Social Security cards for you, your spouse and dependents and/or a Social Security number verification letter issued by the Social Security Administration.
- Birth dates for you, your spouse and dependents claimed on your tax return.
- Current year's tax package if you received one.
- Wage and earning statement(s) Form W-2, W-2G, 1099-R, from all employers.
- Interest and dividend statements from banks (Forms 1099).
- A copy of last year's federal and state returns, if available.
- Bank routing numbers and account numbers for direct deposit.
- Total paid for day care provider and the day care provider's tax identifying number (the provider's Social Security number or the provider's business Employer Identification Number).
- To file taxes electronically on a married filing joint tax return, both spouses must be present to sign the required forms.
Follow-up clinicsWhen low-income taxpayers have tax problems after they've filed, they often cannot afford to hire professionals to help them work through the maze of IRS questions.
To help fill this assistance void, schools and nonprofit groups nationwide provide low-cost -- and in some cases free -- tax clinics, also known as low-income taxpayer clinics, or LITCs. The services are supported in part by financial help from the IRS through its National Taxpayer Advocate office. Each year, the agency solicits applications nationwide from tax clinics, and selected clinics can receive up to $100,000 in matching federal grants.