Expanding Access to Free Tax Preparation through Virtual VITA

For many lower-income workers each year, the services provided by Volunteer Income Tax Assistance (VITA) sites can mean the difference between a tax return that offers a financial boost and one that does not. VITA sites not only help raise awareness within their communities about eligibility for the Earned Income Tax Credit (EITC) and other tax benefits, they also provide tax preparation free of charge to ensure filers collect them.

Unfortunately, far too many lower-income taxpayers live in “tax prep deserts” with very few, if any VITA sites available to help them at tax time. Without the invaluable help of free tax preparation, many of these filers miss out on claiming the EITC.

That’s where Virtual VITA comes in. The program, currently being piloted in communities across the nation, uses technology to offer free tax preparation without requiring either the tax preparer or the filer to be present. Filers’ intake documents are uploaded online and then completed either in real time by an off-site tax preparer or dropped off at a pick-up location for the filer’s convenience. The program requires far fewer frontline resources to implement than a traditional VITA site and returns are completed at about half the cost.

Most recently, Virtual VITA was tested in a pilot program administered in rural areas of Michigan and parts of Arizona, led by the Center for Economic Progress and the former National Community Tax Coalition. The program was also recently tested in two New York City Head Start programs through a partnership between the NYC Department of Consumer Affairs Office of Financial Empowerment and the Administration for Children & Families Region II.

Both pilots identified some initial challenges ranging from a lack of client confidence in the model to technological glitches. However, there was consensus that these obstacles were fixable through additional testing and further investment. Overall, the pilots’ findings demonstrated that Virtual VITA has the potential to become a wide-scale solution that significantly increases access to free tax preparation for lower-income filers.