The following post was written by Keri Spears, who serves at Touching Miami with Love and is one of CBF’s field personnel.
Touching Miami with Love is pleased to offer free tax preparation services. We are a part of The Prosperity Campaign for the seventh year in a row. According to their website, The Prosperity Campaign connects low-wage workers to existing economic benefits programs available to them such as the Earned Income Tax Credit and Childcare Tax Credit. EITC, for example, provides up to $4,700 per year per family, lifting millions of children and their parents beyond the federal poverty level. The program was first launched in 2002.Last week, a couple brought me a pineapple. In some cultures, the pineapple has become associated with the concept of welcome, but at TML I think the pineapple represents thanksgiving.
Jasmine and Fredrick Wallace (names have been changed) came in two weeks ago to have their taxes done. They are married but requested to have their taxes done separately. I asked why they wanted to file separately. The Wallace’s explained that Fredrick receives a 1099 MISC every year and has to pay self employment tax. Several years ago they owed the IRS around $2,000. A friend suggested that they file separately that way the IRS would only take money from Fredrick’s refund and not Jasmine’s, and each of them claim a child.
Part of what we do at TML is to provide a good service to our neighbors but we also try to educate them. I did exactly what the Wallace’s requested me to do; I prepared two separate tax returns filing as married filing separately. Fredrick will receive a refund of $1,000, which will be kept by the IRS to go toward his incurred debt and Jasmine will receive a refund of $100. In the end the Wallace’s walk away with a $100 refund and still owe the IRS that will continue to incur interest.
I urged them to wait another thirty minutes which would allow me to prepare a joint return as a married couple. The Wallace’s were surprised at the difference when I was finished. Jointly, their new refund was a little over $3,000! This would allow the Wallace’s to pay all the money that they owed and might have some left over. $100 versus $3,000 – they were shocked.
After finishing their return, I provided them information for a local free legal aid clinic that specifically works with clients who owe the IRS money. The Wallace’s visited the clinic the next day and a lawyer is working with them to liaison between them and the IRS. The lawyer will negotiate a settlement with the IRS so the Wallace’s can clear their debt to the government.
They came back by TML to let me know about the legal aid visit and to express their appreciation for taking time to explain to them and show them how their tax return can be affected. They left me with a pineapple and kept thanking TML as they walked out.
Last year’s stimulus payment was a benefit to both our community and to TML. We were kept extremely busy with the surge of clients who came in to have their 2007 tax returns completed. Everyone wanted their piece of the stimulus payments. After the large number of clients last year, I was not sure how this year would shape up. Would we have the same numbers as last year, or would people not file again because there was no stimulus payment incentive? Only time would tell.
For our 2009 contract with the Human Services Coalition, we committed ourselves to completing 200 tax returns and back taxes. We have compiled our numbers as of February 28th, 2009 to report to our grantors. I am extremely pleased to report that we have already completed 174 of the 200 required tax returns and we have one of the lowest rejection rates in Miami-Dade County. This was such as surprise and an affirmation for us. Our tax ministry continues to grow each and every year.