Tips for filing your 2020 taxes and how to get free help
It's estimated that Americans spend about $1 billion on tax preparation services each year. For some, that extra fee could mean groceries for the week, or an extra bill paid. Each year the AARP Foundation offers free tax preparation services for seniors and low-income individuals through their free tax-aide program.
For Jose Perez, the extra money not spent paying someone to prepare his taxes means extra money to go towards caring for his disabled daughter.
"I'm on social security now. I don't have another job. I take care of my daughter, so my income has been cut like almost in half," said Perez.
That's why he goes to the Anchorage Senior Center each year to get his taxes prepared. It's one of several Anchorage area sites offering the AARP's free tax-aide program. Jan Watson is the volunteer coordinator for the tax-aide program at the senior center.
"So many people are so very grateful for that because a lot of people will say, 'Oh, I can buy winter coats for my children now,' or provide something for their family that they were kind of worried about," said Watson.
Perez says just a few years ago, Watson helped him find an error. Something missed by a previous paid CPA. He says his disabled daughter wasn't claimed as a dependent for years. "I was able to get three years taxes back when they found this error," said Perez.
Something else they found? A friendship. "Some of them, I know them when I meet them on the street, and then there are others that will say, 'Oh, there's my tax preparer!' and I welcome them and say, I'll see you later in the year!" said Watson.
Perez says he says he now has a sense of comfort in knowing he's in good hands.
"It's a Godsend not to have to worry where you're going to get your taxes, how much you're going to have to pay for them and whether they're being done right, and that's the important thing, and then just the fact that they've become my friends and they're so wonderful, to me anyway. I just value them so much," said Perez.
The IRS began processing returns late last month, and if you're headed to file your taxes, here are a few things to keep in mind.
This year there's no longer a federal penalty for not having health insurance. A penalty still applies in some states, but Alaska is not one of them.
If you're a senior, you may not have to file if you don't have enough income, but if you want to make sure your identity is protected, it's a good idea to file anyway.
"Identity theft is rampant, and that is a way that we can find out if their identity has been stolen," says local tax aide volunteer coordinator, Jan Watson. "We would prepare their return, we would submit it, and if it comes back and says, 'this return has already been filed,' then we know that something is wrong. Then they have to contact the IRS."
Here are a few tips from the AAPR to follow to help you get the best tax results:
- First, talk with your entire family about preparing returns together. You don't want a dependent to do their own tax returns, and not specify that they are a dependent.
- Most dependents do need to file. The $1,606 PFD exceeds the $1,100 maximum for unearned income, so dependents must report it.
- Next, consider investing in your retirement. If you can afford it, even if it's just a little bit, it's a good idea to fund your future now with a contribution to your retirement account.
- File your tax returns as soon as you have all of your documents, then you can look at your return and think of any income changes for the current year, then consider changing your withholding, or estimated tax payments for 2020.
You can find an AARP free tax-aide location near you,
The IRS offers free online tax prep for those who qualify. Taxpayers with incomes less than $69,000 can take advantage of the IRS's
The deadline to file a 2019 tax return and pay any taxes owed is Wednesday, April 15.