Tax season is a stressful time, but there is relief for thousands of hardworking, low-income Anchorage residents who are already financially stressed in these tough times.
Instead of facing the prospect of paying tax preparers and the IRS, many families and individuals have cashed in on free tax preparation assistance and unexpected refunds. They've maximized their returns and minimized their stress thanks to a partnership between the IRS, AARP TaxAide, Volunteer Income Tax Assistance Program and United Way of Anchorage. The group is offering free tax preparation at eight free tax preparation sites around Anchorage and others around the state.
Already this tax season, more than 3,000 Anchorage residents have saved hundreds of thousands of dollars in tax preparation fees, taken in $1.4 million in Earned Income Tax Credits, and pocketed more than $6 million in refunds by taking advantage of free tax preparation and volunteer tax specialists certified by the IRS from AARP TaxAide to do the work.
"I've always been intimidated by the tax process -- I had no idea what I was doing," said Rachel Fisk, a 22-year-old in retail sales. Fisk found clarity at a recent Super Saturday free tax preparation event at Mountain View Boys & Girls Club, where a volunteer tax specialist -- "She was nice, helpful and patient," Fisk said -- guided her through the filing process and to a refund.
"I thought I would owe, but I'm actually expecting a refund," Fisk said. "I was astonished -- $600! I'm definitely going to get my truck running, then I'll be able to get a better job."
Paying the average rate of $142 to have a professional prepare taxes is a luxury low-income Alaskans can't afford. Still, some will drop off their paperwork with tax preparers offering rapid refunds. The quick return comes at a high cost -- elevated preparation fees.
For most, preparing their own taxes becomes a necessity. The problem there is that inexperienced self-preparers overlook tax credits because they simply don't know about them. They'll lose the opportunity to gain hundreds, or even thousands, of dollars on their returns. That's money that should be going into their pockets.
"I got $1,000 more than I got last year -- I'm on Cloud 9!" said a happy Matrona Roehl, who filed for herself and two dependents at the Super Saturday event. She's been going to free tax preparation sites for three years. "If I did it myself, I wouldn't have gotten as much, but they know how to get me the best refund.
"Now I can catch up on bills," Roehl said.
Saving on the tax preparation costs makes a big difference for a family. That equates to a few trips to the grocery store or an electric or energy bill, a chunk of the monthly rent, or savings for a tough stretch.
Last year, more than 3,000 Anchorage residents took advantage of the free tax preparation sites, and in the process saved more than $500,000 in preparation costs, were guided to nearly $750,000 more in tax credits and received more than $3 million in returns. Savings and credits like these during tax season can play significant role in the lives of Alaskans on the edge of homelessness and those just trying to get ahead.
This year, with more Anchorage families living on the edge, the impact can be even greater. If you need tax guidance or know someone who does, please consider the free tax preparation sites. Call Alaska 2-1-1 at 2-1-1 or 1-800-478-2221 or visit LIVEUNITEDANCHORAGE.ORG for details, locations and hours of the free tax prep sites.
Michele Brown is president of United Way of Anchorage.
By MICHELE BROWN