Volunteer Tax & Loan Program Celebrates 20 Years
Alaska Business Development Center helps bring millions back to rural communities
Preparing and filing federal income tax returns sounds like a daunting and rather boring chore, but to some this mundane task can be nothing short of a thrill. Just ask the volunteers who participate in the Alaska Business Development Center (ABDC) Volunteer Tax and Loan Program (VTLP).
“I am so grateful for the opportunity to participate in such an amazing program. Honestly, the scope and vision of the program is commendable as is the execution of it. Overall, I am thoroughly elated with the entire experience!” This comment was captured in an anonymous volunteer survey conducted at the end of the last tax season.
During the past tax season, VTLP teams traveled to eighty rural villages and assisted an additional forty-nine more through the Anchorage Mail-in Site; assisted over 9,100 taxpayers to include more than 1,000 elders aged sixty years or older and over 1,000 commercial fishing captains, crew members, and industry workers; prepared in excess of 4,800 tax returns and delivered nearly 1,400 education presentations; generated over $6.9 million in tax refunds for rural Alaska residents; and captured nearly $2.7 million in the Earned Income Credit.
ABDC operates a unique tax program that brings together a base of volunteers who travel to remote areas of the state to assist residents with tax return preparation and provide education on taxpayer rights and responsibilities. This win-win situation provides a hands-on experience and exciting adventure for the volunteers, while at the same time assisting rural taxpayers with becoming compliant with the IRS, as well as receiving tax education and in many cases scoring a tax refund.
When asked if the work and efforts in the communities visited had a positive impact, volunteers responded, “this is the most gratifying part of this volunteer opportunity” and “we were able to explain information that resulted in additional refunds for several community members.”
Each year more than eighty volunteers are recruited and trained to travel in teams to hard-to-reach villages across the state. During the past season, VTLP volunteers provided more than 4,700 hours of in-kind service to those in need, not including training and travel time.
ABDC recruits volunteers from local entities, professional associations, and universities located within and outside the state of Alaska. Program volunteers are outgoing, adventurous, caring individuals eager to assist others in need. Many of the volunteers are students from partner universities from Washington state, Idaho, Montana, and as far away as New York.
Volunteers participate as either a team leader/educator or tax preparer. All volunteers complete a level of IRS training as well as additional ABDC designed training, which details program and Alaska-specific issues. The required training is typically more than forty hours, depending upon the volunteer, which may seem like a lot for a volunteer program. However, when volunteers were asked if they felt adequately trained and provided adequate support throughout the training process, they responded, “Training was excellent and well thought out” and “I found the [ABDC] case studies to be invaluable and the feedback from ABDC to be extremely helpful.”
Volunteers travel in teams of one to three tax preparers, depending upon the community need, and one team leader/educator. Depending upon the duration of the trip, (weekend or weeklong) teams assist one to four villages. The volunteers travel during the harshest months of winter weather in rural Alaska, braving the elements to bring the much needed services directly to remote regions of the state.
Most of the communities ABDC reaches out to require multiple flights; after arriving in the hub community (a larger rural community) via jet they transfer to a smaller plane (six to nine passengers) and fly to the destination community. Upon arrival they are greeted by the community contact at the airstrip and shuttled, gear and all, by truck, snow machine, or four-wheeler to the workspace where they set up and begin working.
Teams are equipped with laptops, printers, and all items needed to provide a quality service. They are trained to be self-sufficient and to pack lightly, to include food and personal items, and are prepared with sleeping bag and mat as they often sleep on the floor, be it in the village office or school gymnasium.
On many of the trips volunteers work extended hours, often late into the night to ensure all taxpayers receive assistance, since this is typically the only service the community receives.
When asked about the overall experience a volunteer commented, “I had a great experience! The staff at ABDC was incredible, warm, and welcoming. I loved traveling to the villages and getting such an awesome opportunity to help others.”
The Rural Taxpayer
This statewide program is brought directly to hard-to-reach, low income rural residents who do not have direct access to these services.
Direct benefits to the residents include IRS tax compliance; knowledge of taxpayer rights and responsibilities; current and prior year tax return preparation often resulting in a tax refund or Earned Income Credit; assistance with IRS disputes; and consultation on tax issues.
Rural taxpayers responded favorably to anonymous surveys conducted while the teams were in the communities.
- “Very good service and nice helpful volunteers; look forward for next year.”—Anaktuvuk Pass
- “Friendly, able to answer questions without difficulty.”—Goodnews Bay
- “Very helpful and kind.”—Hoonah
- “Thanks for having this available. Thanks for the information. I received answers that I needed.”—Kaltag
- “Your presence in the village is very much appreciated; we welcome you back.”—Kipnuk
- “Keep up the awesome job! Thank you for the information.”—New Stuyahok
- “Good, helpful tax people.”—Nunam Iqua
- “Please continue to come out, very helpful and appreciated.”—Scammon Bay
- “Thank you for coming to our village and helping. Thank you for this is a greatly needed service.”—Tanana
Many rural Alaskans speak English as a second language and their income falls below the federal poverty line. Regardless of their desire to become compliant, rural residents are limited by their inability to afford professional assistance and by a lack of qualified tax practitioners available in their areas. This hinders taxpayers from filing their tax returns and impedes their ability to receive adequate tax counseling.
While there are a rising number of individuals gaining access to free tax preparation services online, reliable internet service is still sporadic throughout rural Alaska. Additionally, many taxpayers who have opted to prepare their own tax returns have later requested assistance from ABDC to correct errors they encountered due to being unaware of how the process works and/or finding the process cumbersome.
Economic and employment opportunities are generally limited to seasonal work, small businesses, teaching, and positions with Alaska Native Corporations and local governments including tribal and city offices. Commercial fishing, hunting and trapping, and making traditional souvenirs such as baskets and skin masks also provide income.
As a result, this population relies on the receipt of tax refunds to provide for their families, including credits such as the Earned Income Credit. These refunds can only be garnered through properly filed federal income tax returns.
Many times the preparation of the federal income tax return results in a refund representing a double digit percentage of the taxpayer’s annual disposable income. Additionally, refunds to taxpayers have a direct impact on the local economies, which in many cases are depressed, and are estimated to have a money multiplier effect of four. This means that each dollar brought back to the community not only helps the individual taxpayer but the community on a whole as the dollar is cycled a minimum of four times within the local economy.
VTLP services help to improve the quality of life throughout the rural communities through education and tax compliance as well as through the millions of dollars in refunds which help taxpayers provide for basic family needs.
In addition to providing direct benefits to rural taxpayers, VTLP indirectly benefits the urban centers through the refunds generated via completed tax returns. Rural Alaska routinely relies on services and goods only available in the city centers, and therefore with the monies received taxpayers are able to purchase these services and goods. Alaska’s largest communities should not ignore the importance the rural dollar has throughout their urban economies.
VTLP is a unique program that is made possible through numerous program contributors. Services are funded through federal grants, private organizations, financial institutions, and program partnerships with Alaska Native Corporations, community development quota groups, and local village corporations, tribes, and cities. ABDC also partners with local entities to assist with recruiting volunteers, providing cultural training, and securing prizes for volunteer recognition and taxpayer educations.
Services are provided to taxpayers residing in partner communities who provide support to the program through monetary and in-kind contributions made directly or indirectly through a regional entity. Services are brought to the villages during the tax season, providing free one-on-one assistance with current year tax return preparation and education on taxpayer rights and responsibilities.
Additionally, services are available through ABDC’s Anchorage office on a year-round basis. Staff prepare current year returns for taxpayers who missed the team while in the community as well as provide assistance with prior year and amended returns. Furthermore, ABDC offers tax consultations on personal tax issues and representation for those taxpayers with an IRS controversy issue. Many times taxpayers receive notices from the IRS that they do not understand and qualified staff is able to work with them to explain and resolve the issue.
VTLP services are not designed to interfere with regional tax practitioners, but rather fill a void by providing assistance to low to moderate income individuals who may not otherwise have access to this type of assistance.
ABDC is proud to announce that 2015 will mark VTLP’s twenty-year anniversary of providing assistance to rural Alaskan residents. VTLP originated in 1995 as a solution to resolve the non-compliance tax issue amongst commercial fishermen, which was a problem that inhibited them from expanding their operations. This was the brainchild of Alaska Division of Investments Director Martin Richard and ABDC President Gary Selk.
VTLP began its first outreach in 1996 by completing 185 tax returns in seven communities. Today, VTLP has grown to be a multifaceted program spanning across ten regions of the state, offering assistance year-round.
For the current tax season ABDC anticipates assisting more than 130 communities, preparing in excess of 5,000 returns, and delivering 1,500 educational presentations.
ABDC is grateful to the valued volunteers who will provide more than 5,000 hours of in-kind service assisting those Alaskans in need. ABDC is also thankful to all program contributors that make this program a success through their continued support.
Contact ABDC to see if your community is a partner community and eligible to receive assistance or if you are interested in volunteering.
Mannie Boitz is a Program Coordinator for Anchorage-based Alaska Business Development Center, Inc., a 501(c)(3) nonprofit corporation founded in 1978. Contact her at 907-562-0335 or firstname.lastname@example.org.
This first appeared in the February 2015 print edition of Alaska Business Monthly magazine.