Sites can prepare basic Federal and Colorado State returns including:
- income from wages (reported on a form W-2), social security benefits, pensions and retirement accounts, interest and dividends, self-employment income with simple business expenses, and proceeds from the sale of stocks and bonds where the cost basis is provided.
- credits including the Earned Income Tax Credit, Child Tax Credit, credit for dependent care expenses, education credits, and qualified residential energy credits.
Some sites are certified to assist with taxpayers who have been through a cancellation of debt or foreclosure, as long as the following conditions are met:
- The taxpayer has received a completed form 1099-C from the lender, the information on the form 1099-C is correct, and there is no interest reported in Box 3.
- The home has never been used in a trade or business, or as rental property.
- There is not a bankruptcy involved.
- The mortgage was used only to buy, build, or improve the principal residence. If any part of the mortgage was used to pay off other expenses – for example, if proceeds from a refinance were used to pay off credit cards, pay for education, etc., then it is outside the scope of the VITA program.
Please contact the site you are planning to visit to make sure they have volunteers to assist with cancellation of debt or foreclosure.
Certain types of returns are beyond the scope of the program and cannot be prepared by a VITA or TCE tax site, even if the taxpayer meets the income requirements (see below).
- Self-employment income (generally reported on form 1099-MISC) where any of the following is true:
- Expenses exceed $5,000
- Expenses include depreciation or business use of the home
- A loss is reported
- The taxpayer has more than one business
- Proceeds from the sale of stocks and bonds where the cost basis is not included on the form 1099-B.
- Income from rental property
- Other forms dealing with advanced tax situations