Four Bands Finishes a Strong Financial Capability Month by Helping Local Residents Receive $1.3 Million in Tax Refunds
April 30, 2015
Residents of the Cheyenne River Indian Reservation kept an estimated $130,000 more cash in their pockets through a free tax service provided by our Volunteer Income Tax Assistance (VITA) site.
We have promoted financial literacy to local residents for the past fifteen years, and have operated a VITA site since 2005. This site is a crucial part of the activities provided during April, designated as National Financial Capability Month, to local residents. Staff helped 524 local residents complete their 2014 tax returns and receive $1.3 million dollars in cash refunds, all free of charge.
In addition, the VITA site helps residents claim the most underutilized tax credit in the nation—the Earned Income Tax Credit (EITC). This tax credit can bring up to $6,400 to each eligible family who files a tax return. Taxpayers who utilized the local VITA site received $684,814 dollars in EITC payments for the 2014 tax year. Overall, local residents have taken home over $2.2 million dollars in EITC tax refund cash since 2005.
Since opening in 2005, our VITA site has helped 2,985 local residents receive $5.3 million dollars in tax refund payments. When taxpayers utilize VITA sites to do their annual returns, they are more likely to receive a larger refund because the service does not charge to complete or file the return. This gives the tax filer an average of $250 dollars more on their refund.
In addition, tax filers do not have to pay for instant refund loan fees or interest when they use a VITA site. Refund anticipation loans (RALs) are a service often provided by paid tax preparers. However, when tax filers use these paid services, they lose a significant portion of their refund cash in preparation fees and interest rates on the instant loans. For example, people who file using a paid tax preparation service could lose out on more than 10% of their total refund just so they can get their money a few days sooner with a RAL.