Tax season doesn’t have to be stressful. Because of MU Extension’s Missouri Taxpayers Education Initiative, known as MoTax, low- to moderate-income families have a way to avoid the expense of hiring experts to file their taxes. The program provides free assistance in Missouri to households that earned less than $40,000 last year, individuals with disabilities and the elderly.
In the Columbia area, the initiative is a partnership with the MU department of personal financial planning, Human Environmental Sciences Extension, the Central Missouri Counties’ Human Development Corporation and the Internal Revenue Service. In the second year of its pilot phase, the program is gaining recognition. With more than 650 tax returns already filed this year, the project is on target to surpass last year’s total of 800. April 14 is the last day to file with the MoTax Volunteer Income Tax Association sites in Columbia.
The tax association, an IRS initiative, is part of the program.
Throughout the state, more than 20 association sites provide free tax preparation as part of the MoTax program. In Columbia, 54 personal financial planning undergraduate students from MU and a few community members help run the program at three different sites.
These IRS-certified volunteers, along with site coordinators, prepare and electronically file taxes and offer materials to promote financial education.
“This is a really good program because it is for families who need help but don’t have the money to get their taxes done,” said Ami Galske, a junior at MU, who used MoTax for the first time.
Commercial tax preparers often try to get low-income tax filers to take out Refund Anticipation Loans — high-interest loans, repaid from the tax refund, that allow taxpayers to receive refunds within five days.
The high interest rate can be avoided by filing taxes electronically through Volunteer Income Tax Association sites.
This allows direct deposit of the refund into a bank account within seven to 10 days.
Waiting a few extra days can save taxpayers a substantial percentage of their refunds. In 2003, 6.9 million low-income American workers paid more than $690 million in unnecessary fees, according to the Children’s Defense Funds.
“We want to make people aware of the choices that they are making,” said Sandra Huston, assistant professor and extensions specialist in the department of personal financial planning at MU.
Huston said she hopes to have the Get Checking program active in Columbia next year. Get Checking allows people who have had banking problems in the past to reopen an account.
After six hours of class, course graduates receive a certificate allowing them to open an account at participating banks or credit unions. Get Checking allows these taxpayers get their refund checks deposited straight into their accounts.
The St. Louis area recently adopted the program.
The 54 student volunteers involved with MoTax are currently in Huston’s service-learning class, which requires 45 hours of community service. The students spent hours over their Christmas breaks studying and preparing for the three IRS tests that they were required to pass.
“It was hard becoming certified,” said Brian Raine, a junior majoring in personal financial planning. “It took a lot of work.”
Huston said the hard work is worth it. Not only do Huston’s students get the opportunity to give back to their community, they also learn valuable financial and counseling skills that will help them compete in the job market after graduation.
“It’s really a win-win situation for student volunteers and the many individuals and families they serve through the MoTax program,” Huston said.