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Free Tax Preparation

In the 2009 tax year, the Advocacy Center for Persons with Disabilities, Inc. piloted a Volunteer Income Tax Assistance (VITA) tax initiative using our Tallahassee office as a mobile tax site. We targeted outreach to persons with disabilities in the Big Bend area of Florida. In the 2010 tax season, we are expanding on the initiative to increase awareness of the existence of free tax preparation and increase awareness of the:

• Earned Income Credit
• Child Tax Credit
• The New Making Work Pay Credit
• First-Time Homebuyer Credit

Video Tax Tips: Filing Season 2010 - January 2010 (ASL, Captions & Voice Over)
and the interaction of tax credits and public benefits along with information on the availability of other asset building opportunities.

The Advocacy Center is proud to partner with the 2010 REAL ECONOMIC IMPACT TOUR, the United Way of Big Bend BEST Project, Florida Division of Vocational Rehabilitation (VR), Florida Division of Blind Services (DBS), North Florida Area Agency on Aging and the Internal Revenue Service/Stakeholder Partnership, Education and Communication (SPEC) on the Leon County Florida Disability Tax Initiative.

• Living and working with Disabilities Tax Credits and Benefits - IRS Publication 3966 (Rev 10-2008)
• Tax Highlights for Persons with Disabilities Feb 03, 2010 - IRS Publication 907

Free Tax Preparation

Get free tax filing help through the IRS-sponsored Volunteer Income Tax Assistance (VITA) or Tax Counseling for the Elderly (TCE) programs. Both programs can provide fast electronic tax filing. Community volunteers receive IRS-approved training to assist individuals with tax returns. Some VITA sites can help you open a bank account if you don’t have one.

The Advocacy Center for Persons with Disabilities, Inc., “FREE TAX SITE” prepares basic federal income tax returns free of charge for individuals of low to moderate income. We are an authorized IRS e-file provider.

  • Federal tax return preparation
  • IRS e-file (electronic filing) for federal tax returns
  • Refund splitting (allows you to save part of your refund in a second account)

WHEN: Wednesdays between 1:00 p.m. and 4:00 p.m. EST, beginning March 3, 2010 and ending April 14, 2010.

WHERE: Advocacy Center for Persons with Disabilities, Inc., 2728 Centerview Drive, Suite 102, Tallahassee, FL 32301

Appointments preferred but not necessary. Assistance is offered on a first-come, first-served basis. For more information or directions, call 850-488-9071 ext 450

More Information

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Earned Income Tax Credit

The Earned Income Tax Credit or the EITC is a refundable federal income tax credit for low to moderate income working individuals and families. Congress originally approved the tax credit legislation in 1975 in part to offset the burden of social security taxes and to provide an incentive to work. When the EITC exceeds the amount of taxes owed, it results in a tax refund to those who claim and qualify for the credit.

To qualify, taxpayers must meet certain requirements and file a tax return, even if they did not earn enough money to have a filing requirement.

The EITC has no effect on certain welfare benefits. In most cases, EITC payments will not be used to determine eligibility for Medicaid, Supplemental Security Income (SSI), food stamps, low-income housing or most Temporary Assistance for Needy Families (TANF) payments.

Resources

Child Tax Credit

Do you have a Child or Children?

You may be eligible for the Child Tax Credit and the Additional Child Tax Credit.

The Child Tax Credit is a nonrefundable credit and may be as much as $1,000 per qualifying child, depending upon your income.

The credit will be reduced if your adjusted gross income is over:

  • $110,000* and your filing status is married filing jointly
  • $75,000* and your filing status is single, head of household, or qualifying widow
  • $55,000* and your filing status is married filing separately

* Special rules may apply if you have income from outside the U.S.

If you qualify for the Child Tax Credit, you may qualify for the Additional Child Tax Credit. The Additional Child Tax Credit is a refundable credit and may give you a refund even if you do not owe any tax. This credit is for certain individuals who receive less than the full amount of the Child Tax Credit. File Form 8812 to claim the Additional Child Tax Credit.

Resources

Making Work Pay Credit

The Making Work Pay Credit is a new tax credit for working people worth up to $400 for an individual and $800 for a married couple filing jointly, regardless of whether or not they have children. In order to quickly provide the credit to most workers, the IRS has reduced the amount of income tax employers should withhold from each paycheck, so most workers are paying less tax and getting more income with each pay. Workers will receive $400 spaced out in their paychecks between April 1 and December 31, 2009 rather than waiting until they file a tax return to get the credit. This increase in income could be as much as $50 per month. You did not need to do anything to start getting the credit, and it won’t be counted as taxable income when you file your tax return. If your employer did not change the withholding on your pay, don’t worry, you’ll be able to claim this credit when you file your 2009 tax return.

Resources

First-time Homebuyers Credit

Here are key points about the expanded first-time homebuyer credit and how one qualifies for it.

  1. You must buy – or enter into a binding contract to buy a principal residence – on or before April 30, 2010.
  2. If you enter into a binding contract by April 30, 2010 you must close on the home on or before June 30, 2010.
  3. For qualifying purchases in 2010, you will have the option of claiming the credit on either your 2009 or 2010 return.
  4. A long-time resident of the same home can now qualify for a reduced credit. You can qualify for the credit if you have lived in the same principal residence for any five-consecutive year period during the eight-year period that ended on the date the new home is purchased and the settlement date is after November 6, 2009.
  5. The maximum credit for long-time residents is $6,500. However, married individuals filing separately are limited to $3,250. The maximum credit for first-time homeowners is $8,000 (up to $4,000 for married filing separately).
  6. People with higher incomes can now qualify for the credit. The new law raises the income limits for homes purchased after November 6, 2009. The full credit is available to taxpayers with modified adjusted gross incomes up to $125,000, or $225,000 for joint filers.
  7. The IRS will issue a revised Form 5405 to claim this credit on 2009 tax returns. The revised form must be used for homes purchased after November 6, 2009 – whether the credit is claimed for 2008 or for 2009 – and for all home purchases that are claimed on 2009 returns.
  8. Homebuyers who claim the credit on their 2009 tax return will not be able to file electronically but instead will need to file a paper return. For homes purchased in 2009 there is an option to take the credit on an original or amended 2008 tax return.
  9. The new law includes documentation requirements. See revised Form 5405 for details.
  10. No credit is available if the purchase price of the home exceeds $800,000.
  11. The purchaser must be at least 18 years old on the date of purchase. For a married couple, only one spouse must meet this age requirement.
  12. A dependent is not eligible to claim the credit.

The IRS encourages all eligible homebuyers to take advantage of the First-Time Homebuyer Credit but at the same time cautions taxpayers to avoid schemes that help ineligible people file false claims for the credit.

Resources

IRS Taxpayer Advocate Service

There may be times when you receive a letter from the IRS about your tax return or you identify a problem that requires IRS assistance. Most issues can be handled easily with a simple phone call to 1-800-829-1040. If you receive a letter or notice from the IRS you will generally receive instructions for responding.

  • Taxpayer Assistance Center (TAC)
    If you find you need to speak with someone face to face, the IRS has Taxpayer Assistance Centers located throughout the country. Be prepared to show identification when visiting an IRS office. See Tax Topic Visiting an IRS office for identification requirements.
  • Taxpayer Advocate Service (TAS)
    If you are experiencing economic harm or a systemic problem, or are seeking help in resolving tax problems that have not been resolved through normal channels, you may be eligible for Taxpayer Advocate Service (TAS) assistance. You can reach TAS by calling the TAS toll-free case intake line at 1-877-777-4778 or TTY/TTD 1-800-829-4059.
  • Low Income Taxpayer Clinic (LITC)
    You may also qualify for assistance through a Low Income Taxpayer Clinic. LITCs are independent organizations that provide low income taxpayers with representation in federal tax controversies with the IRS for free or for a nominal charge. The clinics also provide tax education and outreach for taxpayers with limited English proficiency or who speak English as a second language. Publication 4134, Low Income Taxpayer Clinic
  • Taxpayer Advocate Service 
    What if I need legal representation to help with my tax problem but can’t afford it?

More Tax Credits

American Opportunity Credit

  • Replaces the Hope Credit for post-secondary education expenses (also called Expanded Hope Credit)
  • Maximum credit is $2500 compared to $1800 for the Hope Credit
  • The credit is partially refundable, making it available to lower income families who have no income tax liability and who were not eligible for the Hope Credit.
  • The credit can be used for up to four years of post-secondary education and can be used to cover expenses for books and materials in addition to tuition

Video Recovery: Education Tax Credit – Claim It (Parents) – January 2010 (ASL, Captions & Voice-over)

New Car Sales Tax Deduction

You can deduct the sales tax paid on the purchase of a new car, light truck, motor home or motorcycle. The vehicle must be purchased between February 17 and December 31, 2009.

Unemployment

The first $2400 of unemployment benefits will not be counted as taxable income in 2009

Resources