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Author: lorenzo2 Big red star, 1000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 121590  
Subject: VITA Musing #2 Date: 2/15/2003 1:29 PM
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This is the next installment in the continuing saga of Lorenzo, New TCE Guy. If that's an unfamiliar acronym, TCE is Tax Counseling for the Elderly, which is pretty much the same as VITA (Volunteer Income Tax Assistance). Phil Marti frequently talks up VITA on this board, and many regulars here are VITA or TCE volunteers. I took the bait last fall, signed up, had tax and computer training, and here I am. There are two previous postings along these lines, numbers 62894 and 62993 on this board.

So - after a snow-induced one week delay, I have finally come face to face with living, breathing U.S. taxpayers. Yesterday, I spent about 4 1/2 hours at a local senior center, doing six returns (three federal, three state) for three sets of customers: one single, two married joint. It was interesting and eye-opening, to say the least.

I was most relieved that all my customers were seniors, 60s and above. (In an earlier posting, I fretted some about assorted credits - Earned Income, Child, Additional Child, etc. - and Phil Marti cautioned about brushing up on dependency, foster-child type rules.) But not to worry, there were few such customers at the center, and none for me. At this particular location, there are five volunteers on duty each day, plus a sixth who doublechecks prepared returns. We typically do 15 returns each day (well, 30 if you count both federal and state...) and I think the center has, in its first two weeks, efiled some 100 plus returns. Our center is the largest in the county, but there are half a dozen satellite locations, and I think about 40-50 volunteers altogether.

In any case, mostly pretty basic returns, with none of them eligible for credits of any kind. (Well, one guy had a foreign tax credit from a mutual fund, but that's routine.) A little earned income, but mostly Social Security and pension. Though it does appear that there's something weird, or at least different, with each return you do. One customer had disability income, which caused a bit of a stir on the state return. Another had income as an election judge, which I decided went on line 21. Another customer was kind of hoping for a refund, but he hadn't paid anything into the system. (Yeah, I know there are refundable credits, but they didn't apply.)

The biggest surprise to me was not the tax stuff - that was pretty straightforward - but the socioeconomic aspects of it all. I was astonished (and a little dismayed) to see how little some people have to get by on. Two of the three customers had a taxable income of zero. No one had a very robust AGI. Ok, Social Security is largely excluded in most cases, so their financial situations weren't quite as grim as they first appeared - but still...

In particular, after just a day helping others with taxes, I've concluded that the Bush tax proposals are just plain wrong. They largely benefit the wealthy, or at least the well-off. I certainly understand the argument that people with significant income and assets pay more in taxes, and thus should receive more in relief. I guess my point is that they don't need relief! The people who need help are the low-income type people I saw yesterday. (I know, they already get relief in a sense, because their income is low enough that they pay no taxes.) I don't think of myself as rich, though I am comfortable in retirement: I live in a nice house, drive a nice car, have adequate savings and a generous pension. I will benefit greatly from the proposed elimination of taxation on dividends, but the truth is, I don't need that particular tax break, or any other. My dividend income alone is greater than the AGI of two of my customers yesterday.

Ok, enough of the ranting. I know I probably shouldn't get political on this board. After just one day, I'll say it's been rewarding, and fun. I'll post again if something exciting happens, and certainly in April after we're done for the year.

Lorenzo, TCE Guy
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