!"#$ Free Tax Program Final Report

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1 Free Tax Program Final Report!"#$ The United Way of Fairfield County saw unprecedented success, in 2015, in assisting low- moderate income families file their federal, state and school district income taxes. With the help of volunteers, UWFC assisted over 1,600 families file their taxes, refunding over $2.3 million.

2 The United Way of Fairfield County operated its ninth year as a Volunteer Income Tax Assistance Site (VITA) and its fourth year as a Tax Counseling for the Elderly Site (TCE) for tax season VITA offers free tax preparation for lowto moderate-income individuals and families while TCE offers free tax preparation for clients over the age of 60 in Fairfield County. The site utilizes IRS Certified Volunteers to prepare and file tax returns. The United Way of Fairfield County s tax site s goal is to increase education, awareness, and claims of the Earned Income Tax Credit (EITC) as well as provide tax assistance and guidance to clients. The EITC is the largest refundable credit that can be claimed on an individual tax return; up to $6,242 for tax year The EITC is initiative enacted by Congress to offset the burden of Social Security taxes and provide an incentive to work. The IRS estimates that approximately 20% of eligible workers do not claim the EITC. During the 2015 filing season the United Way of Fairfield County was able to provide free tax preparation to 1,646 clients. This is an increase of 15% from 2014 (1,426 returns filed). Of 1,646 clients, 1,093 were VITA clients while 553 were TCE clients. Both programs saw a significant increase is clients assisted in The site also provided 587 Earned Income Tax Claims totaling $989,446. In all, the tax site program provided a total of $2,323,350 in federal refunds and $112,118 in state refunds. The tax program operated 5 days per week during the tax season from its main office location in downtown Lancaster at the United Way of Fairfield County offices. In an effort to increase awareness, as well as convenience, tax preparation was also offered at one day sites in Pickerington and Baltimore, OH. Also, United Way of Eagle-Rock Church in Pickerington, River Valley Mall in Lancaster, and Ohio University in Pickerington. This gave clients the option to file their taxes during weekend hours if they were unable to file during the week. More than ever, United Way of Fairfield County relied on committed tax volunteers to prepare tax returns. Volunteers had to go through several hours of training and test completion before becoming certified to prepare returns. Volunteers gave numerous hours throughout the week and weekend assisting tax clients. In total, 10 volunteers assisted United Way of Fairfield County in tax preparation efforts in One volunteer describes his experience below:

3 At 7o years of age I should know better by now. When I get bored I strike out for something new, uncharacteristic for me. And then wonder, Now, what was I thinking when And so this explains how I find myself in a class at the United Way on how to assist low income and elderly complete their income tax returns, VITA for short. And the simple fact that I actually passed the test at the end of the class is a testament to this marvelous class. For a while I shadow my fellow workers Barb and Sheila and then begin my own journey on Jan 23rd thru April 10th 2015, every Friday, meeting an interesting array of individuals and families I thought I knew. I came home every Friday both exhausted and exhilarated. The people I met, my clients, were not who they appeared. My first married filing joint. He has the worn, knit hat pulled down over a tattered baseball cap, no teeth and she is wrapped up in OSU knits still fighting the cold January day. They present an interesting picture. Both quickly produce required ID and one W-2 for his work as a driver of meals for the elderly and homebound. He earns about $9000 a year has health insurance, and loves his job delivering 60 meals a day throughout the county. Tells me at length about how they should expand to serve more people. Has even thought about who would donate the money. They get a $400 refund. This is a young girl, about twenty accompanied by her mother. Listen carefully. She lives at home with her Mom and two siblings, she is a full time student getting two majors in education and fine arts, (studying sign language on the side which she insists on practicing on her mom or me while I am interviewing her) she has two jobs at a grocery store and local elementary school as a substitute teachers assistant. She has income of $3000 and gets an EIC of $230. Why do I get this EIC? Because you choose to work dear, the Mother responds with obvious pride and that pleases her. Mom and daughter leave, happy that this job is done. For so many, you get the sense that this task is like voting or giving blood. They do it quietly, without fanfare, almost stoically, but they do it early and leave satisfied with themselves. They don t expect the thank you they hear from all of the staff and eagerly return it. They hardly ever complain. And at the same time there is rarely the sense of entitlement you would expect when you fully grasp what they earn, where they live, and then the EIC and refund they receive. For some it is met with mild surprise and appreciation. No greed here, no gaming of the system. We should double the EIC for the Grandparents who are raising these kids. As I reflect back upon the past ten Fridays I have spent with these VITA folks and their clients, I am struck by the consistent qualities I have observed in almost all of the clients. They appear to come from all levels of education, age and work experience. Diverse, except racially which may be more a reflection of our county s population. Yet they all exhibit the same humility, appreciation, and a sense of responsibility to pay their taxes. We have completed over 1500 returns. I understand that the average refund is $1,400 and the amount they save is on average $250 in fees at VITA. This does not include what they may have paid to cash in their refund immediately. One would expect to see more anxiety over the amount of their refund or even greed. Not the case in my experience. Yes, these folks represent the other one percent. And while they may pay a higher percentage of tax on income than Warren Buffett, they seem to gain something more from their work. And I can only wonder if in fact they are the one percent who comes out ahead. As I recall the faces of the cosmetologist, the pizza, burger, dollar store worker, student, and truck driver. As I see them again, they are not tattered and tired as they first appeared to me. They are the real Americans, perhaps as only Norman Rockwell could capture them.

4 For the second season, United Way of Fairfield County offered Fairfield Saves accounts to eligible tax clients, a program sponsored by PNC Bank. By depositing a portion of their tax refund into a newly opened savings account, clients took the first step towards saving for the future. Incentives were provided, in the form of bonus deposits made by United Way of Fairfield County, if a client continued to make deposits on a monthly basis and their account remained above the original deposit. Several clients opened new accounts in 2015 and currently 44 client savings accounts are still open and carrying a balance with PNC Bank. These are individuals and families who were unbanked and now have savings for a emergency. Also for the second season, the drop-off method was offered to tax clients. Clients were able to leave all of their tax information with United Way of Fairfield County staff to be completed within a week. A total of 53 clients utilized the drop-off method which drastically reduces waiting time for clients for clients to book appointments, and makes additional tax appointments available late in the tax season. Clients return a week after dropping off information to review and sign their tax return. United Way of Fairfield County continues to host self-prep kiosks allowing clients to self-prepare a tax return at United Way of Fairfield County with staff assistance if needed or from their home using Myfreetaxes.com. This method provided the opportunity for tax clients to see the tax preparation process first hand, building the confidence to electronically self-prepare in the future. In total, the United Way of Fairfield County assisted 100 tax clients with the selfpreparation method. Partnerships are necessary for driving results and for advancing our ability to expand services. With support from the IRS and PNC Bank, along with hundreds of volunteer hours, over 1,600 tax returns were filed and over $2.3 million was refunded to Fairfield County families and individuals. These are dollars which will stay in Fairfield County and these are the families and individuals who need it the most. While 2015 may have been a great tax season, 2016 is just around the corner and United Way of Fairfield County has big plans to make it every greater.

5 United Way Tax Program History Year Number of Returns Adjusted Gross Income Refund Amount VITA TCE TOTAL VITA TCE TOTAL VITA TCE TOTAL $13,748 - $13,748 $87,081 - $87, $14,354 - $14,354 $146,531 - $146, $14,933 - $14,933 $463,601 - $463, $14,920 - $14,920 $1,004,505 - $1,004, $15,664 - $15,664 $1,228,864 - $1,228, $16,993 $18,785 $18,451 $1,340,460 $194,586 $1,535, $18,023 $21,791 $19,261 $1,538,570 $281,721 $1,820, $18,469 $22,563 $19,695 $1,868,667 $329,530 $2,198, $19,813 $22,744 $20,872 $1,924,872 $398,478 $2,323,350 Total $16,324 $21,471 $16,878 $9,603,151 $1,204,315 $10,807,466 Year EITC Claims EITC Amount EITC Percentage VITA TCE TOTAL VITA TCE TOTAL VITA TCE TOTAL $55,807 - $55, $88,130 - $88, $202,470 - $202, % % $407,449 - $407, % % $504,749 - $504, % % $567,301 $12,508 $579, % 7.82% 31.63% $654,154 $29,785 $683, % 9.95% 32.99% $865,156 $34,931 $900, % 10.04% 32.19% $852,814 $136,632 $989, % 15.55% 35.66% Total $4,198,030 $213,856 $3,422, % 11.40% 27.18% Federal Summary VITA TCE TOTAL Returns E- Filed Paper Prior Year Returns Amended Myfreetaxes.com Completed but Not Filed Totals

6 Federal Summary (cont.) VITA TCE TOTAL AGI $19813 $22,744 $20,872 EITC Claims Total EITC Claims $852,814 $136,362 $989,446 AVG EITC Claim $1,702 $1,589 $1,686 EITC Claims Percentage 45.84% 15.55% 35.66% Returns e- filed with Refund Total Refunds $1,924,872 $398,478 $2,323,350 AVG Refund $2,254 $1,074 $1,897 Returns e- filed Balance Due Total Balance Due ($66,273) ($83,558) ($149,831) AVG Balance Due ($989) ($983) ($986) State Summary VITA TCE TOTAL Returns with Refund Total Refunds $69,395 $42,723 $112,118 AVG Refund $153 $240 $177 Returns Balance Due Total Balance Due ($11,177) ($5,385) ($16,562) AVG Balance Due ($385) ($215) ($307) Family Breakdown Filing Status VITA TCE Total Single 57% 52% 55% Married Filing Joint 17% 45% 27% Married Filing Separate 6% 2% 5% Head of Household 20% 2% 14% Qualifying Widow 0% 0% 0% Dependents VITA TCE Total 0 70% 92% 78% 1 18% 6% 13% 2 8% 1% 6% 3 3% 1% 2% 4 1% 0% 1% Additional Credits Child Tax Credit VITA TCE Total Number Received Total $ Received $86,301 $5,849 $92,150 Average Credit $830 $731 $823 Education Credits VITA TCE Total Number Received Total $ Received $156,586 $1,450 $158,036 Average Credit $3,470 $496 $1,265 Unemployment VITA TCE Total Number Received Total $ Received $190,400 $47,450 $237,850 Average Assistance $3,462 $3,650 $3,498

7 Participants were encouraged to complete a questionnaire that would provide us insight regarding who uses our site and what financial products they currently use. Education VITA TCE Total No formal education 1% 0% 0.5% Elementary or Middle School 2% 0% 1% High school or GED 47% 39% 43% Some college 30% 46% 38% Two year degree (Associates) 10% 7% 8% Four year degree (Bachelors) 10% 9% 10% Living Arrangement VITA TCE Total Own my home 21% 66% 43% Rent home or apartment 48% 25% 37% Live with a family member 24% 7% 15% Live with a friend 5% 2% 4% Live in a dorm 1% 0%.5% Currently homeless 1% 0%.5% Types of Credit VITA TCE Total Home Mortgage 15% 43% 29% Automobile Loan 32% 27% 30% Student Loan 30% 5% 17% Credit Card 45% 68% 57% Other Loan 9% 8% 9% None 31% 14% 22% Debt VITA TCE Total Under $ % 36% 36% $1000 to $ % 22% 18% $5001 to $10,000 13% 14% 13% $10,001 to $20,000 16% 14% 15% $20,001 to $30,000 8% 7% 8% Over $30,000 10% 7% 9% Who prepared your taxes last year? VITA TCE Total United Way of Fairfield County 69% 82% 76% I did not file a tax return 6% 2% 4% I did it myself 4% 7% 6% A family member 3% 0% 2% A friend 2% 0% 1% Professional tax preparer 10% 9% 9% Another free tax site 2% 0% 1% Other 6% 0% 3%

8 Have you received the EITC in the past? VITA TCE Total Yes 60% 32% 46% No 40% 68% 54% How did you hear about us VITA TCE Total United Way of Fairfield County 27% 27% 27% Civil/Social Service Agency 4% 0% 2% Filed here last year 32% 48% 40% Word of Mouth 27% 18% 23% Online or Newspaper Ad 7% 9% 8% Coupon 1% 2% 2% Radio Ad 1% 0%.5% Flyer or Poster 4% 5% 4% Billboard 4% 0% 2% Postcard 1% 0%.5% Other 0% 0% 0% Why Free Tax Prep VITA TCE Total It s Free 42% 25% 33% Friend suggested it 21% 16% 18% I came here last year 57% 75% 66% It s close to home 10% 5% 7% I saw/heard an ad 6% 14% 10% Using Refunds VITA TCE Total Household bills, rent, etc. 55% 34% 44% Pay on loans 27% 16% 22% Lease or purchase a car 8% 0% 4% Child care 6% 0% 3% Groceries and/or clothing 18% 7% 12% Repairs for car or home 23% 7% 15% Medical or dental expenses 9% 18% 14% Place in checking/savings 31% 34% 32% Pay credit card bills 24% 14% 19% Vacation 5% 9% 7% Other 17% 11% 14% Type of Accounts VITA TCE Total Checking and savings 50% 80% 65% Checking only 37% 18% 28% Savings only 4% 2% 3% CD or money market 2% 7% 4% No, but I would like one 1% 0%.5% No, not interested 9% 2% 6%

9 Services Used VITA TCE Total Used a payday lender 5% 2% 4% Took out a loan from a bank 10% 14% 12% Refinanced a loan or loans 3% 2% 3% Consolidated loans 3% 2% 3% Applied for a credit card 21% 11% 16% Took a financial literacy class 0% 0% 0% Used a Pawn Shop 3% 0% 2% Filed bankruptcy 0% 0% 0% None 66% 68% 67% Why do you have trouble saving? VITA TCE Total Not enough income 56% 38% 48% Too much debt 16% 9% 13% Access to a bank 1% 0%.5% Too many bills 24% 5% 14% Unsure of ways to save 2% 2% 2% Don t have trouble saving 30% 48% 39% Anyone in the house disabled VITA TCE Total Yes 15% 30% 22% No 85% 70% 78% Occupation VITA TCE Total unemployed 10% 7% 9% Retired 3% 43% 23% Homemaker 2% 2% 2% Administrative 8% 9% 8% Laborer 15% 2% 9% Health Care 14% 7% 10% Education 3% 7% 5% Cleaning 2% 2% 2% Student 6% 0% 3% Food Service 14% 2% 8% Retail 10% 9% 9% Sales 9% 2% 4% Financial Institution 1% 0%.2% Manufacturing 4% 0% 2% Social Service 2% 5% 4% Child Care 1% 2% 2% Temporary Worker 2% 0% 1%

10 Months Employed VITA TCE Total Unemployed Full Year 3% 9% 6% Retired Full Year 2% 34% 18% 12 61% 34% 47% 11 5% 2% 4% 10 5% 2% 4% 9 4% 5% 6% 8 3% 9% 6% 7 5% 0% 3% 6 2% 2% 2% 5 5% 0% 1% 4 2% 0% 2% 3 2% 0% 1% 2 2% 2% 2% 1 2% 0% 1% Average Hours Worked VITA TCE Total Unemployed Full Year 3% 9% 6% Retired Full Year 2% 27% 15% Less than 10 3% 5% 4% 10 to 20 9% 14% 11% % 7% 14% % 30% 38% Over 40 17% 9% 13%