Accounting , Areas of Study Stories | Apr 10, 2012 | Nicole Gesualdo
VITA volunteers provide vital tax services at no charge
As the April 15 tax deadline approaches, many low-income Bronx residents are seeking less-expensive alternatives to the costly advisory services offered throughout the borough. In response to this demand, Gabelli School of Business students are offering their time and tax knowledge to the Fordham-sponsored University Neighborhood Housing Program’s Volunteer Income Tax Assistance program, known as VITA, which provides free tax preparation to qualifying individuals and families.
Every year, low-income Bronx residents lose millions of dollars to tax-preparation fees and interest on so-called “refund anticipation loans,” a form of short-term borrowing that some paid preparers offer. People get their refund money up front, without waiting for the check to arrive from the IRS, but there is a big catch that many borrowers don’t fully understand: Preparers often charge equivalent annual interest rates of more than 50 percent on what amounts to a one- or two-week collateralized loan. They can end up in debt for months, or even years.
The VITA program offers free advisory services and uses electronic filing to get a client his or her refund in 7 to 10 business days. Last year, the program helped more than 1,000 Bronx residents to receive almost $1.4 million in refunds. Jack Lutkewitte (GSB ’15), a finance major who volunteers with VITA, can attest to its value. “Seeing firsthand the financial struggles of many Bronx residents really shows the benefit of the program,” he said. “I enjoy interacting with the clients and developing many useful skills.”
Jack’s experience highlights the twofold benefit of the program to Gabelli students. VITA volunteers have an invaluable opportunity to give back to the Bronx community and to hone their tax accounting skills. Professor Dennis Cappello, who has been running a private accounting practice since 1986 and who helps coordinate Fordham’s involvement in the program, confirms the quality of the hands-on experience: “These students are doing what I do in my practice with respect to tax preparation.”
Volunteers can offer their time either helping with tax preparation or gathering intake information – the former requiring online IRS certification. Students can expect to receive exposure to the long and short form of the federal Form 1040, including Schedules A through E, and the New York state Form IT-201 or Form IT-150. According to Professor Cappello, this real-world exposure to tax-return filing is especially useful for those students who take the Federal Taxation course, which includes all accounting majors.
Many students have found equally valuable the client interaction from the perspective of the tax preparer. In any industry, coaxing information out of a client can be a difficult task. “While they’re not necessarily withholding information from you, unless you ask the right questions, they may not think to tell you something important,” Professor Cappello said.
Ultimately, the VITA program offers Gabelli students from all majors the opportunity to help out the local community and see the tangible results of their efforts – the epitome of service-learning. “The service aspect is highly rewarding, and interacting with members of the Bronx community allows the tax preparer to form a bond with each client with which he or she works,” said volunteer Chad Hoke (GSB ’15). “It is very gratifying because you know the money that you save the clients in their tax return relieves a financial burden and is much appreciated.”
The program is growing rapidly and needs new volunteers for the future. Anyone interested in volunteering for a few hours or for the entire 2013 tax season can reach out to Professor Cappello at firstname.lastname@example.org or Brian Dunn, director of honors opportunities, at email@example.com.