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Wednesday, April 13, 2011
Tuesday, April 12, 2011
Another Guest Blog from DelCoAD!
Hillary Kane is the Director of Philadelphia Higher Education Network for Neighborhood Development (PHENND). PHENND helps colleges and communities connect to share resources to improve the lives of students and neighbors. In 2004, PHENND help start DelCoAD.
What did you learn in college? Did you learn any practical skills such as how to balance your checkbook or how to shop for a loan? How about how to do your taxes? Probably not.
Unfortunately, most colleges focus strictly on academics and to a lesser extent other soft skills such as leadership development. And while both of these things are hugely important, we all know that in the game of life, it takes more than smarts and leadership to accomplish your goals. You also need some basic household skills.
Enter Delaware County Asset Development’s Volunteer Income Tax Assistance program. While VITA is primarily aimed at helping low- and moderate-income families get free tax preparation services, it has also become a great teaching tool for many local college students. For the past seven years, students from area colleges, such as Swarthmore College and Widener University, have been learning some important life skills all in the name of service to their community.
Each winter, students are recruited as volunteer tax preparers for DelCoAD’s massive free tax prep initiative. Typically, 75-80 students volunteer and in the process, they learn all about basic tax law and how to prepare an income tax return. The students are certified by the IRS and then through the Spring Semester (which coincides nicely with tax season), they volunteer to help people do their taxes at one of nine sites throughout Delaware County.
Last year, students along with other volunteers from the community, provided free tax services to 1800 filers who collectively received over $2.5 million in refunds. This year’s numbers will be revealed at our End of the Season Celebration, Monday, April 25th at Swarthmore College. For more information, visit www.delcoad.org .
What did you learn in college? Did you learn any practical skills such as how to balance your checkbook or how to shop for a loan? How about how to do your taxes? Probably not.
Unfortunately, most colleges focus strictly on academics and to a lesser extent other soft skills such as leadership development. And while both of these things are hugely important, we all know that in the game of life, it takes more than smarts and leadership to accomplish your goals. You also need some basic household skills.
Enter Delaware County Asset Development’s Volunteer Income Tax Assistance program. While VITA is primarily aimed at helping low- and moderate-income families get free tax preparation services, it has also become a great teaching tool for many local college students. For the past seven years, students from area colleges, such as Swarthmore College and Widener University, have been learning some important life skills all in the name of service to their community.
Each winter, students are recruited as volunteer tax preparers for DelCoAD’s massive free tax prep initiative. Typically, 75-80 students volunteer and in the process, they learn all about basic tax law and how to prepare an income tax return. The students are certified by the IRS and then through the Spring Semester (which coincides nicely with tax season), they volunteer to help people do their taxes at one of nine sites throughout Delaware County.
Last year, students along with other volunteers from the community, provided free tax services to 1800 filers who collectively received over $2.5 million in refunds. This year’s numbers will be revealed at our End of the Season Celebration, Monday, April 25th at Swarthmore College. For more information, visit www.delcoad.org .
Thursday, April 7, 2011
IMPORTANT Guest Blog about your Taxes!
Today's guest blogger is Georgia Julius, the Executive Director and VITA Coordinator at Delaware County Asset Development.
April is upon us, and as if a shower-filled forecast isn’t enough to bring us down, Tax Day can, for some, appear a to be another storm cloud on the horizon. I am writing in hopes to debunk a few tax season myths and explain that tax season should be nothing to dread.
Myth: Tax Day = Doomsday
Tax Day, which usually falls on April 15th every year, has been pushed back to Monday the 18th due to Emancipation Day in Washington D.C. Most don’t realize that the April due date only ever applies to taxpayers who owe money to the IRS and not to those who are receiving refunds. This doesn’t necessarily mean you should dilly dally on claiming your refund though, because you are missing out on having that amount securely in your account and earning interest. If you do owe, you should do the best you can to pay in full by April 18th. If this is impossible, you can call the IRS at 1-800-829-1040 and work out a payment plan. They ask that you pay as much as possible but they are willing to work with what you are capable of. Explain your situation and ask them what you can do so that you don’t owe next year. If you are an employee who receives W-2 tax documents, this may involve changing the exemption amount on your W-4 to a higher number (ie. 1 instead of 0, which accounts for no federal withholding). If you are a contract worker or self-employed and you expect to owe over $1,000, you may want to consider filling out a form 1040ES and paying quarterly estimated taxes for 2011. Ignoring taxes won’t make them go away and the sooner you deal work with the IRS, the better off you will be
.
Myth: “You have to spend money to make money,” or, alternately, “You can’t get something for nothing”
The average amount spent to have a tax return prepared is $183, which may not seem like a lot compared to refunds some receive upwards of $1,000, but it is certainly a lot compared to $0. That’s how much Volunteer Income Tax Assistance, or VITA, sites charge for their tax preparation services. On top of that, VITA sites offer free e-filing, state return preparation, direct deposit and referalls and access to other benefits. Delaware County Asset Development Group, or DelCoAD, runs nine free tax preparation sites in Delaware County and similar programs run free tax prep sites at thousands of locations in the surrounding counties and across the nation.
Myth: The IRS is out to get you
The VITA program is a collaborative effort between the IRS, organizations and coalitions like DelCoAD and its partners and volunteers from colleges, universities and the community. It serves to help low-income taxpayers access the credits for which they are eligible, specifically the EITC, or Earned Income Tax Credit. The guidelines for the EITC and therefore for the VITA eligible population, change every year. This year, VITA sites are qualified to help taxpayers and their families with a 2010 income of under $50,000. The EITC is a refundable credit, which means you can get more money back than just the federal income taxes you already paid--a lot more money. In fact, the EITC is considered to be the best anti-poverty tool in the United States. That’s because it can increase a household’s yearly income by a large percentage. See the below example and remember, this is not even including other possible credits, like the Child Tax Credit or education credits: A single parent with three children who earned $21,000 in 2010 is eligible for $4,702 of EITC, bringing his or her income up to $25,702. In this case, the EITC makes up over 18% of that family’s yearly income.
This chart shows the parameters for the 2010 tax year along with the maximum refund amounts:
Myth: You get what you pay for
Tax preparation at a VITA site is free but that doesn’t mean you get what you pay for. All VITA Volunteers are trained and certified in tax law by an IRS training program with an emphasis on obtaining all eligible tax credits. Most VITA programs, including DelCoAD, have additional training in customer service and asset development tools (savings bonds and prepaid debit cards, for example). All VITA volunteer-prepared returns are quality reviewed by an experienced volunteer through a process that the IRS has been honing for years. And then the tax software provides one last once-over before your return is submitted to the IRS. At VITA programs, quality is job number one and the client is our priority..
For more information: See www.delcoad.org for a list of our sites and their hours in Chester, Sharon Hill, Darby, Media and Holmes. You can also call me, Georgia Julius, at 610-543-5022 x228 with any questions or to find the nearest tax site to you. Have a Happy Tax Day!
*EITC limitations graph courtesy of PathWays PA
Getting Down to Brass Tax:
True Tax Facts with DelCoAD
True Tax Facts with DelCoAD
April is upon us, and as if a shower-filled forecast isn’t enough to bring us down, Tax Day can, for some, appear a to be another storm cloud on the horizon. I am writing in hopes to debunk a few tax season myths and explain that tax season should be nothing to dread.
Myth: Tax Day = Doomsday
Tax Day, which usually falls on April 15th every year, has been pushed back to Monday the 18th due to Emancipation Day in Washington D.C. Most don’t realize that the April due date only ever applies to taxpayers who owe money to the IRS and not to those who are receiving refunds. This doesn’t necessarily mean you should dilly dally on claiming your refund though, because you are missing out on having that amount securely in your account and earning interest. If you do owe, you should do the best you can to pay in full by April 18th. If this is impossible, you can call the IRS at 1-800-829-1040 and work out a payment plan. They ask that you pay as much as possible but they are willing to work with what you are capable of. Explain your situation and ask them what you can do so that you don’t owe next year. If you are an employee who receives W-2 tax documents, this may involve changing the exemption amount on your W-4 to a higher number (ie. 1 instead of 0, which accounts for no federal withholding). If you are a contract worker or self-employed and you expect to owe over $1,000, you may want to consider filling out a form 1040ES and paying quarterly estimated taxes for 2011. Ignoring taxes won’t make them go away and the sooner you deal work with the IRS, the better off you will be
.
Myth: “You have to spend money to make money,” or, alternately, “You can’t get something for nothing”
The average amount spent to have a tax return prepared is $183, which may not seem like a lot compared to refunds some receive upwards of $1,000, but it is certainly a lot compared to $0. That’s how much Volunteer Income Tax Assistance, or VITA, sites charge for their tax preparation services. On top of that, VITA sites offer free e-filing, state return preparation, direct deposit and referalls and access to other benefits. Delaware County Asset Development Group, or DelCoAD, runs nine free tax preparation sites in Delaware County and similar programs run free tax prep sites at thousands of locations in the surrounding counties and across the nation.
Myth: The IRS is out to get you
The VITA program is a collaborative effort between the IRS, organizations and coalitions like DelCoAD and its partners and volunteers from colleges, universities and the community. It serves to help low-income taxpayers access the credits for which they are eligible, specifically the EITC, or Earned Income Tax Credit. The guidelines for the EITC and therefore for the VITA eligible population, change every year. This year, VITA sites are qualified to help taxpayers and their families with a 2010 income of under $50,000. The EITC is a refundable credit, which means you can get more money back than just the federal income taxes you already paid--a lot more money. In fact, the EITC is considered to be the best anti-poverty tool in the United States. That’s because it can increase a household’s yearly income by a large percentage. See the below example and remember, this is not even including other possible credits, like the Child Tax Credit or education credits: A single parent with three children who earned $21,000 in 2010 is eligible for $4,702 of EITC, bringing his or her income up to $25,702. In this case, the EITC makes up over 18% of that family’s yearly income.
This chart shows the parameters for the 2010 tax year along with the maximum refund amounts:
Myth: You get what you pay for
Tax preparation at a VITA site is free but that doesn’t mean you get what you pay for. All VITA Volunteers are trained and certified in tax law by an IRS training program with an emphasis on obtaining all eligible tax credits. Most VITA programs, including DelCoAD, have additional training in customer service and asset development tools (savings bonds and prepaid debit cards, for example). All VITA volunteer-prepared returns are quality reviewed by an experienced volunteer through a process that the IRS has been honing for years. And then the tax software provides one last once-over before your return is submitted to the IRS. At VITA programs, quality is job number one and the client is our priority..
For more information: See www.delcoad.org for a list of our sites and their hours in Chester, Sharon Hill, Darby, Media and Holmes. You can also call me, Georgia Julius, at 610-543-5022 x228 with any questions or to find the nearest tax site to you. Have a Happy Tax Day!
*EITC limitations graph courtesy of PathWays PA
Tuesday, April 5, 2011
From the Delaware County Times: Tax Tips
To coincide with this week's blog series on tax preparation, here is an article from the Delaware County Times with some tax tips:
Top 10 Tax Tips for 2010-2011
Contributed by Cathy McKeever of Bond, Pezzano & Etze, PC and
Principal Tax Advisors, LLC
1) GET ORGANIZED – Good organization of your tax and financial information is key to claiming all tax benefits each year.
2) TAKE YOUR INFORMATION TO YOUR ACCOUNTANT – NOW! - Waiting until the last minute could mean missing tax deductions from your return.
3) BE CERTAIN THAT YOU ARE TAKING EVERY DEDUCTION YOU ARE ENTITLED TO.
4) MAKE SURE YOU HAVE ALL YOUR DEPENDENTS LISTED ON YOUR RETURN.
5) IF YOU SOLD STOCK IN 2010 – make sure you have your Cost Basis for the sale to minimize gain or to take a loss on your returns
6) Here are some of the ways to save tax dollars:
7) FULLY FUND YOUR 401K or Traditional IRA.
8) TAKE ADVANTAGE OF TAX CREDITS YOU ARE ENTITLED TO:
a. CHILD CREDIT – for qualifying dependent children
b. CHILD AND DEPENDENT CARE CREDIT - for daycare expenses for working parents/caregivers
c. EDUCATION CREDITS – for tuition paid for post High School education
d. ENERGY CREDITS – for energy saving improvements to your primary home – heating systems, water heaters, insulation, windows and doors.
9) CONSIDER FUTURE TAX SAVINGS- with the help of your accountant
a. Consider converting a traditional IRA to a ROTH IRA – you have two years to pay tax on the conversion amount – may save taxes later
b. Plan Estimated tax payments for next year, if you owed this year.
10) MAKE A COMMITMENT TO MEET WITH YOUR ACCOUNTANT FOR TAX AND FINANCIAL PLANNING –
a. Avoidable tax mistakes can be caught when you discuss your finances with your accountant!
Monday, April 4, 2011
Tax Services: What’s Available in Delaware County
April 15 is fast approaching, which means that Delaware County residents need to make sure that their income tax returns are completed and submitted to the Internal Revenue Service as soon as possible. Tax preparation can be complicated, and many people seek outside assistance with their taxes. The more popular options for tax preparation are a licensed professional like an accountant, tax preparation websites, or the tax payer completing the return themselves.
Completing tax returns can be critical for low-income individuals and families. First of all, avoiding submission of your income tax returns can lead to problems with the IRS, which eventually could lead to legal issues. Second of all, proper tax preparation can give low-income individuals and families money back, as well as help save money in the long run. Learning how to prepare taxes and meeting with a trusted professional can only aid those who find themselves in a dire financial state.
There is help here in Delaware County. The Delaware County Asset Development group is a coalition of community organizations that help provide families with an income less than $50,000 with free tax preparation. The coalition and its partner agencies run several VITA (Volunteer Income Tax Assistance) sites throughout the County that you can find here.
If you are eligible, take advantage of these resources. These services can aid you with not only your tax preparation, but give you the knowledge to prepare your own taxes as well.
Completing tax returns can be critical for low-income individuals and families. First of all, avoiding submission of your income tax returns can lead to problems with the IRS, which eventually could lead to legal issues. Second of all, proper tax preparation can give low-income individuals and families money back, as well as help save money in the long run. Learning how to prepare taxes and meeting with a trusted professional can only aid those who find themselves in a dire financial state.
There is help here in Delaware County. The Delaware County Asset Development group is a coalition of community organizations that help provide families with an income less than $50,000 with free tax preparation. The coalition and its partner agencies run several VITA (Volunteer Income Tax Assistance) sites throughout the County that you can find here.
If you are eligible, take advantage of these resources. These services can aid you with not only your tax preparation, but give you the knowledge to prepare your own taxes as well.
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