Volunteer Income Tax Assistance

Puzzled by the tax law or which credits and deductions to take? We provide area residents free assistance with their tax returns.

INFORMATION ABOUT MONMOUTH COLLEGE TAX ASSISTANCE CONCERNING 2020 TAX RETURNS

This year, the service will be provided through a drop-off process. Click on “Drop Off Instructions” on the bar to the left for what you need to do to submit your tax information for return preparation.

Puzzled by the tax law or which credits and deductions to take? Need assistance with your tax return at no cost to you?

Volunteer Income Tax Assistance (VITA) is an IRS program designed to assist low-income taxpayers with filing their tax returns. Each spring, the Monmouth VITA program offers computerized tax preparation and e-filing (federal and Illinois state) at no cost to the taxpayer.

Maximum income to qualify for assistance at Monmouth*
Filing Status
Single - $66,000
Married, Joint - $105,00

RETURNS THAT INCLUDE THE FOLLOWING WILL NOT BE PREPARED AT THIS SITE:

- Small business,

- State returns other than Illinois,

- Reporting of large number of capital gain transactions (Schedule D), or

- Other complicated tax situations as determined by the site coordinator.

Volunteers are Monmouth College students that have been trained and certified by the IRS to prepare tax returns. They can help you with special credits, such as the Premium Tax Credit, the Earned Income Tax Credit (EITC), the Child Tax Credit, education credits such as the American Opportunity Tax and Lifetime Learning Credits, and the Savers Credit.

In addition to free tax return preparation assistance, we offer free electronic filing. You can expect refunds in half the time compared to returns filed on paper – even faster if you have your refund deposited directly into your bank account.

Of Interest for the 2020 Federal Tax Return:

  • Delays of Refunds.
    The IRS estimates that the earliest refunds for tax returns with claims for the Earned Income Tax Credit (EITC) and the Additional Child Tax Credit (ACTC) will be mid-February if direct deposit is selected. This applies to the ENTIRE REFUND and not just the credit amounts. All social security numbers used to claim the EITC must be issued on or before the due date of the return (including extensions). You may not later claim the credit on a late original return or an amended return (an identity theft feature).
  • Provisions of the Affordable Care Act (ACA).
    Taxpayers may have purchased health insurance from the government marketplace. If so, they will receive Form 1095A that is to be used on their income tax return. Taxpayers may have received an advanced subsidy, or be eligible for a subsidy, for their purchase and this is reconciled on the tax return based on their income.
  • There are no longer exemption amounts.
    The Child Tax Credit for dependent children under 17 is $2,000 per child. A social security number for the child is required to obtain the Child Tax Credit. There is a $500 credit for other dependents.
  • Standard Deduction Amounts Increase.

    The amount depends on your filing status and whether you are 65 or older or blind. The basic standard deduction amounts for 2020 are:

Head of household — $18,650 (up from $18,350)

Married taxpayers filing jointly and qualifying widow(er)s — $24,800 (up from $24,400)

Single and Married taxpayers filing separately — $12,400 (up from $12,200)

The standard deduction amount for an individual who may be claimed as a dependent by another taxpayer is the smaller of the taxpayer’s normal standard deduction (per filing status) or the sum of $350 and the individual’s earned income, but not lower than $1,100.

  • The American Opportunity Tax Credit Available for 2020.
    It is available for the first four years of post-secondary education. The maximum amount of credit is $2,500 per eligible student and includes required course materials to the list of qualifying expenses (in addition to tuition and fees). In addition, 40% of this credit (limited to $1,000) may be refundable, meaning that if the taxpayer does not have a tax liability, a refund is still possible. Expenses are deemed paid by the taxpayer taking the dependency credit for the qualified student. Phase out of the credit begins at $80,000 (single) and $160,000 (joint). No change from 2019.
  • Tuition and Fees Deduction for 2020.
    Is an adjustment to income (not a credit) up to $4,000 of qualified tuition and related expenses. If the student is a dependent, the taxpayer must have paid the expenses to take this deduction, not the student. If the student is not a dependent, amounts paid for educational expenses by others on the student’s behalf are deemed a gift to the student, and the student can take the deduction on his/her return.
  • First Time Homebuyer Credit No Longer Available after 2010.
    However, for those who bought a home in 2008 and received a credit, the taxpayer should have begun repayment in 2010 that will continue over a 15-year period. Form 5405 is used to determine the repayment.
  • Definition of Qualifying Child.
    To be a qualifying child, the child must be younger than the taxpayer, unless the child is permanently and totally disabled. If the parents of a child can claim the child as a qualifying child but neither parent claims the child, no other eligible person can claim the child as a qualifying child unless that person’s AGI is higher than the highest AGI of any parent of the child. A taxpayer’s child is a qualifying child for purposes of the Child Tax Credit only if the taxpayer can claim the child as a dependent.
  • Rules for Children of Divorced or Separated Parents.
    This applies to the noncustodial parent in situations where a couple is divorced or legally separated after 2008. To claim a child as a dependent, the noncustodial parent must attach Form 8332 (signed by the custodial parent) to his or her tax return, rather than certain pages from the divorce decree or separation agreement. For pre-2009 divorces and separations, the noncustodial spouse still has the option of attaching those pages.
  • Increased Earned Income Credit Benefits Depending Upon Earned Income and Filing Status.
    • $3,584 with one qualifying child (up from $3,526)
    • $5,920 with two qualifying children (up from $5,828)
    • $6,660 with three or more qualifying children (up from $6,557)
    • $538 with no qualifying child (up from $529)

Those whose investment income is more than $3,650 cannot claim this credit.

  • Alimony.
    Beginning Jan. 1, 2019, alimony or separate maintenance payments are not deductible from the income of the payer spouse, or includable in the income of the receiving spouse, if made under a divorce or separation agreement executed after Dec. 31, 2018.

This also applies to a divorce or separation agreement executed on or before Dec. 31, 2018, and modified after December 31, 2018, as long as the modification:

  • changes the terms of the alimony or separate maintenance payments; and
  • states that the alimony or separate maintenance payments are not deductible by the payer spouse or includable in the income of the receiving spouse.

On the other hand, generally alimony or separate maintenance payments are deductible from the income of the payer spouse and includable in the income of the receiving spouse, if made under a divorce or separation agreement executed on or before Dec. 31, 2018, even if the agreement was modified after December 31, 2018, so long as the modification is not one described in the preceding paragraph.

  • Charitable Contribution Deduction.
    New and only for 2020, taxpayers may deduct up to $300 of CASH charitable contributions even though they are not itemizing.
  • Economic Impact Payments (stimulus) received in 2020 (also known as Recovery Rebate Credit).

    The economic impact payments you received in 2020 and 2021 will be reconciled on the 2020 tax return. You will not have to repay any of the payments you received, but it is possible you may be able to receive more based on your situation in 2020.

First payment in 2020:

  • Eligible individuals received up to $1,200.
  • Eligible married couples received up to $2,400.
  • Eligible individuals received up to $500 for each qualifying child*

Second payment in 2021:

  • Eligible individuals received up to $600.
  • Eligible married couples received up to $1,200.
  • Eligible individuals received up to $600 for each qualifying child*

*A qualifying child is a child who meets the conditions for the Child Tax Credit.

Taxpayers received a reduced payment if their adjusted gross income is between:

  • $75,000 and $99,000 if their filing status was single or married filing separately.
  • $112,000 and $136,500 for head of household.
  • $150,000b and $198,000 if their filing status was married filing jointly.
Please note: The information covered on our web site is not intended as tax advice nor should it be construed as tax advice. Monmouth College volunteers are not professional tax advisors and cannot give tax advice. For tax advice assistance, contact a professional tax advisor.