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Help Immigrants File Tax Returns

Alan Berube
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Alan Berube Interim Vice President and Director - Brookings Metro

April 25, 2005

April 15 has come and gone. Most people spend hours on the complex federal and state income tax forms and cross their fingers that they got the numbers right.

Imagine how much harder the job is if you don’t speak English well. As the April 15 Metro story “April 15 Anxiety With Twist; Some Immigrants Desperate for Help” pointed out, each year thousands of working immigrant families seek advice and assistance from area nonprofits when tax time rolls around. These agencies provide free and low-cost tax preparation and connect families to crucial benefits such as the earned income tax credit, which provides low-income working families with up to $4,000 annually.

But demand for these free and low-cost services outstrips capacity. As a result, nearly 60 percent of low-income immigrants in this region pay someone to file their returns, whereas 1 percent file returns through volunteer organizations.

Some commercial tax preparers provide good service at reasonable prices. But many offer poor advice, charge unconscionable fees and sell expensive “instant refund” loans to families already short on cash. These fly-by-night operators are nowhere to be found when their sub-par service creates IRS problems for their clients.

This area’s local governments should bolster financial and technical assistance to organizations that serve low-income immigrants at tax time. Modest funds would enable these agencies to buy the computers and software to complete and file tax forms. Experts on loan from state tax agencies can help them with tough tax questions that frustrate many immigrant workers.

Filing taxes is an important symbolic act for immigrants, as well as an important practical step on their road to becoming citizens. A small investment would help them navigate the annual financial ritual that is part of the journey.