Since 2020, tax season has been turned on its head and forced to adapt to changing economic circumstances. A number of factors had to be accounted for like mass layoffs and sky-rocketing unemployment, government stimulus checks sent out based on previous year’s tax returns, and changes to the tax code itself. But Raheem says, transitioning out of the pandemic may have its own set of tax challenges and clients need to be aware – the code is changing again.
Raheem volunteers his time and expertise with Free Tax Help at the Santa Maria Urban Ministry site in San Jose. He moved to the Bay Area in 2020, just as COVID-19 was ramping up and many aspects of life were locking down. Still, he knew he wanted to find a way to give something back to the community.
“I’m a CPA,” he said. “I switched from public accounting to the Internal Revenue Service (IRS), which is how I heard about the VITA program.” ”
“During COVID, [When I moved] to San Jose, a lot of people were unemployed and the last two years [they] have just been hit with economic downturn and rising prices [so] I wanted to get involved in the community.”
According to Raheem, he serves a mostly Spanish-speaking community, and sees clients that tend fall into one-of-three categories: Families that mostly know what they’re getting on their returns and expect things to remain within certain levels, those needing I-10 applications to work without citizenship but want to make sure they’re filing taxes properly, and the growing population of those experiencing homelessness or housing instability who are first-time filers to get to government stimulus checks.
His volunteering efforts have been a time for education for both him and his clients, with one of the key takeaways being – additional funds for people in need are out there in the form of tax credits, which means taxes need to be filed to receive them, and many don’t realize it.
“The money gets allocated, but it runs through the tax system. Whether it’s the Child Tax Credit, Earned Income Credit, or education credits, all this money is available, but people don’t know how to access it. But [Free Tax Help] kind of puts dollars directly back into the hands of individuals that those funds are allocated for.”
For the 2020 and 2021 tax seasons, many who needed economic relief during the most difficult times of the pandemic were able to find it by filing their tax returns. Those that may have been waiting on backlogged unemployment checks were able to supplement some of those payments in the refunds they gained from tax credits. State and Federal stimulus checks were tax-free, which also provided an additional boost. Still, the 2022 season may look a little different than those years for some, as Raheem notes a few changes to the tax code that volunteers, and clients will need to be aware of when preparing to file:
Still, he is hopeful that this year they’ll be able to serve clients in person and help them navigate the updates to get the most that is available to them just as in years past.
“California’s return is always a little confusing and hard to file,” he says.
“Knowing some of those nuances is really helpful. [When you’re] in front of the client, talking to [them] face-to-face, it’s easier to understand their story and maximize all the different benefits they can receive.”
Tax season is on its way in. You can join Raheem in providing making sure our Bay Area neighbors have access to no-cost quality tax services. Visit the UWBA Free Tax Help Volunteer site for information about volunteering and how to start getting your certification today!