Sens. Coons, Brown Introduce Bill to Boost Free Tax Preparation and Filing Services for Low-income Individuals, Families

Press Release

With tax season underway, U.S. Senators Chris Coons (D-Del.) and Sherrod Brown (D-Oh.) this week introduced legislation that would support free tax preparation sites that help individuals and families file their income tax returns. The Volunteer Income Tax Assistance (VITA) Act would make permanent an Internal Revenue Service (IRS)-administered grant program for volunteer tax preparation sites nationwide, including in Delaware.

"I am proud to work with my colleague Senator Sherrod Brown to codify and expand funding for the VITA program, an IRS taxpayer assistance program that provides valuable services to low-income families in both of our states," said Coons. "Besides finally authorizing VITA, our legislation will boost the program by helping steer more AmeriCorps members to tax preparation sites around the country. As someone who launched and ran a number of AmeriCorps programs, I hope that mobilizing more dedicated public servants to this cause will help families around the country take advantage of critical tax breaks for the low-income, like the Earned Income Tax Credit."

"It should be easy for working Americans to file and claim their hard-earned money," said Brown. "Volunteer tax preparers provide critical assistance to those who need a hand filing so they can make sure they are receiving all the tax credits they are eligible for and getting the return they've earned. They also save taxpayers money by cutting down on administrative costs."

Specifically, the bill codifies and doubles funding for the IRS's critical VITA program, which provides grants to non-profits around the country that are dedicated to providing free tax preparation services to low-income individuals and families. Additionally, the bill creates a National Center to coordinate and improve the network of more than 6,200 VITA sites around the country. Finally, the bill boosts the VITA network by helping steer more AmeriCorps and other national service positions to VITA sites around the country.

Non-profits that participate in VITA offer free tax preparation for individuals with incomes less than $35,000 a year and families with incomes less than $54,000. VITA volunteers are trained to advise taxpayers on how to take advantage of tax credits like the Earned Income Tax Credit, the Child Tax Credit, and state or local tax credits that families in need may not know about.

In Delaware, there are three organizations that participate in VITA: the Nehemiah Gateway Community Development Corporation, the First State Community Action Agency, and the Delaware Alliance for Community Advancement (DACA). Together these three organizations run close to 20 taxpayer assistance sites across Delaware, using space offered by local libraries, educational institutions, and other public buildings. In 2015 more than 200 volunteers filed more than 15,000 returns and collected over $25 million in returns for participants.

"Grants to Nehemiah from the IRS's VITA program have expanded our capacity to provide valuable free tax preparation services to Delawareans across the state," said Maisha Thoms, Tax Campaign Director at Nehemiah Gateway Community Development Corporation. "The additional funding from VITA has allowed us to work with First State Community Action Agency to run the Delaware Tax and Financial Services Campaign, an initiative to increase financial literacy and financial empowerment among Delawareans during tax season and beyond. Senator Coons knows how much the VITA grant means to us and we appreciate his efforts to expand the program."

"The Earned Income Tax Credit (EITC) is a proven work incentive and valuable tax benefit for lifting low-income individuals and families out of poverty. For so many working individuals and families, it is a much needed economic boost and aid to paying off debt, improving personal credit, savings and financial planning. Everyone eligible for EITC needs to know that they have a right to claim it," said Bernice Edwards, Executive Director of First State Community Action Agency. "We thank Senator Coons for fighting to expand and improve the VITA program so that our organization can help more Delawareans claim the tax benefits, like the EITC, that can have such a positive impact on their lives."

"The IRS VITA expansion that Senator Coons is fighting for would help organizations like DACA educate low income working families about free taxpayer assistance programs before tax filing season," said Darlene Battle, Executive Director of the Delaware Alliance for Community Advancement. "This will help guarantee a decrease in the percentage of families who missed our services during prior years."

U.S. Rep. Danny Davis (D-IL-7) introduced companion legislation in the U.S. House of Representatives. The legislation is supported by the Corporation for Enterprise Development and the United Way.

"For 45 years, VITA sites have turned limited resources into big results in their local communities," said Andrea Levere, President of Corporation for Enterprise Development, the national non-profit that leads the Taxpayer Opportunity Network. "The number of VITA-prepared returns has increased 300% over the last decade, even while VITA sites maintained a 94% accuracy rate -- the highest rate of any type of preparer. This shows that the need for Congressional authorization of this grant program has never been greater. We applaud Senator Brown, Senator Coons, and Congressman Danny Davis for leading the effort to make permanent and boost the VITA program."

Senator Coons is the Ranking Member on the Financial Services and General Government Subcommittee on Appropriations, which makes him the top Democrat overseeing funding for taxpayer assistance programs run out of the IRS. As a strong advocate for policies to promote financial literacy and help families take advantage of critical tax breaks, Senator Coons has fought for increased funding for VITA and other taxpayer assistance programs. Further details on free tax preparation programs in the state can be found on his website here.

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