Virtual tax preparation case studies

Context

CA$H Maine has been a leader in using tax time to communicate the importance of saving and to provide saving options. At tax sites, staff in the role of opportunity guides help taxpayers save and take other actions that improve their financial well-being. They use information collected at intake to engage taxpayers in conversations about their financial challenges and goals and how saving a portion of their tax refund could help. This follows one of our Tax Time Savings Initiative’s promising practices for increasing saving at tax time : dedicate staff or volunteers to encourage saving.

In past years, CA$H Maine used a train-the-trainer model to prepare opportunity guide volunteers. Due to the heavy winters in Maine, many local organizations have already developed technologies and procedures that enabled them to work remotely, and CA$H Maine was able to use the University of Maine’s remote training platform to train leaders from each local coalition. Those local leaders, in turn, trained their opportunity guides.

Challenge

CA$H Maine’s challenges this year were two-fold. First, the train-the-trainer model for opportunity guides had proven burdensome for local coalition leaders, given their other responsibilities, and it also led to training inconsistencies. Second, midway through the 2020 tax season, the COVID-19 pandemic limited the ability to conduct in-person trainings and forced the organization to rely on virtual technology for both service delivery and program management.

Response

CA$H Maine’s leadership decided to deliver a single statewide opportunity guide volunteer training via the remote training platform for 2021.

CA$H Maine offered the two-hour training at five different times in January. Because no one signed up for the Saturday offering, just four sessions were held during both daytime and evening hours. Attendance ranged from four to 27, with a total of 55 participants. Those who couldn’t attend a session live could access a recording.

Results

Although the two-hour session length seemed daunting, the sessions moved quickly and smoothly. Training participants viewed the experience positively, especially the discussions of how to use sample conversation starters to talk with filers about savings.

Local coalition coordinators also liked the unified approach. One commented that a consistent statewide training for the opportunity guide volunteers provided updates and new information in an environment that helped them make the best use of their time as volunteers, as well as instilled confidence in their role and provided context by sharing historical information about CA$H Maine.

Looking Forward

CA$H Maine expects to continue the virtual opportunity guide and return preparer trainings beyond the pandemic. One potential improvement the coalition coordinator identified was trying to move some of the presentation content into handouts or online resources to open up time for conversations among volunteers in virtual breakout rooms.

CA$H Maine’s statewide coordinator cited the principal benefits from her perspective: “It broadened access to training expertise, promoted consistency that maximizes the likelihood of successful savings conversations, and gave local volunteers the opportunity to see and experience the program’s statewide reach.”

“And it sure beats battling snow plows,” she added.

Context

Money Power Day® is CASH Campaign of Maryland’s (CASH) annual and free financial fitness fair that usually draws 800 to 1,000 attendees. The fair offers a combination of workshops, an exhibitor hall (for non-profit organizations, businesses, and government agencies), and financial services including credit counseling, legal services, and tax-return preparation. This implements one of our promising practices for increasing saving at tax time : hold special events to encourage saving.

Challenge

The 15th annual Money Power Day® in 2020 would normally have occurred in late March or early April, but CASH had to postpone it due to the COVID-19 pandemic lockdown. Knowing they couldn’t replicate an event that relied on people gathering in person, they needed a new plan.

Response

CASH Campaign of Maryland had experienced virtual conferences and seen the demand for virtual services. To make the event fit the new approach’s capabilities, they prioritized access to financial education services, exhibitors, and a virtual financial planning zone.

The virtual Money Power Day® was held on October 17, 2020, with 57 exhibitors and 607 registered attendees. The day included several workshops, which were pre-recorded, with 40 minutes of content and 20 minutes for questions and answers via a live chat box.

A total of 235 people participated on the day of the event, and 164 of those attended one or more of the financial education workshops. The most-attended workshop, with 96 participants, was Credit Check-Up. Follow-up e-mails focused on those who registered but didn’t attend. Anyone who had registered was able to access the event’s content online for 30 days after the event.

Results

CASH Campaign’s staff was happy with the online conferencing platform they chose. Exhibitors had a range of options: text with links, a chat box, pre-recorded videos, live video conferencing, and scheduled one-on-one video chats. Some stayed all day, and the platform featured red and green lights to show if a “booth” was currently staffed.

Staff knew the format would present obstacles in serving the most vulnerable populations. This was certainly true for community members without smartphones or with limited access to or comfort with technology.

A positive aspect of attendance was participation by residents from 21 of Maryland’s 24 counties, underscoring the role of virtual technologies in reaching widespread regions. Money Power Day® is typically held at a high school in Baltimore.

Looking Forward

Applying the lessons learned from the 2020 event, CASH Campaign of Maryland is increasing their use of social media platforms for distanced participation in its service offerings, including live-streaming content. Maryland CASH Academy has also increased its online financial education. CASH is also looking for ways to provide content through other organizations’ virtual events.

CASH Campaign’s director of financial capability reflected: “It was a really great event. While we don’t see ourselves trying to do another fully virtual financial fair, we’ve learned some new ways of doing things that we’ll be taking forward beyond the pandemic.”

Context

South Texas’s cdcb | come dream. come build (cdcb) operates a Volunteer Income Tax Assistance (VITA) program that typically prepares returns for more than 600 families each year. The organization also participates in the CFPB’s Tax-Time Savings Initiative to promote the use of tax returns to build savings and financial stability.

cdcb partners with GetYourRefund, the national program of Code for America that provides organizations that operate VITA sites with tools for preparing returns virtually. cdcb provides its virtual services in both Spanish and English.

Challenge

In a socially distanced world, virtual VITA creates opportunities, but it can also limit tax preparers’ opportunities to talk about the importance of saving refunds. For example, cdcb found that conversations with taxpayers were limited to the very end of the virtual VITA process when they reviewed tax returns together. “And at that point, they want to get off the phone quickly, making it much more challenging than meeting in person,” reflected cdcb’s VITA program manager.

Response

To reach taxpayers at more receptive moments, social media provided a valuable alternative communication channel. Cdcb regularly posted short videos to provide information on the 2021 tax season, including the new process for preparing online returns, economic stimulus payments, and the extension of the filing season in Texas due to winter storms.

Results

Digital marketing strategies expanded the reach of the program, which typically has just one paid staff member and two unpaid volunteers. The staff has a considerable amount of information to convey, but this was especially true in 2021. Social media provided a channel to reach new audiences and to provide timely tax and financial information to cdcb’s followers.

Looking Forward

Social media will continue to serve as an important resource to communicate with those they serve. Posting short videos can remind taxpayers about the opportunity to use their tax return to save some of their refund, reinforcing one of our promising practices for increasing saving at tax time : communicate with taxpayers about saving before they come to the tax site.

Context

Many tax programs rely on the interaction between taxpayers and return preparers to promote saving at tax time. The Boston Tax Help Coalition and CA$H Maine also use dedicated savings volunteers—called financial guides and opportunity guides, respectively—who have been present at tax sites to assist with savings and other financial capability interventions.

CA$H Maine opportunity guides are trained to have extended conversations with taxpayers. They make referrals to local saving opportunities, such as New Ventures Maine’s Rainy Day Savings Account program. For several years, opportunity guides have also provided the Scan and Go drop-off option at tax sites and the offices of local community partners.

Boston Tax Help’s financial guides provide taxpayers with one of the most extensive financial well-being consultations in the VITA field, administering the Financial Check-Up to screen taxpayers for various financial challenges. The Financial Check-Up includes a credit review and is an integral part of the Boston Builds Credit campaign. Financial guides have traditionally been an integrated component of in-person tax services.

Challenge

In response to the COVID-19 pandemic, VITA programs dramatically shifted operations to “Virtual VITA,” a term the IRS uses to describe both fully virtual service delivery, where the taxpayer is not physically present at any point and transmits documents electronically, and drop-off, where taxpayers deliver documents to a tax program location but are not present when returns are prepared. Virtual VITA eliminates face-to-face interactions, but it can often reduce communication with taxpayers.

For example, taxpayers using Virtual VITA don’t always know which documents they need to provide and often struggle with uploading and transferring files. The volunteer preparing the return can have difficulty reaching the taxpayer for missing information and obtaining additional information can create delays and burdens for the taxpayers.

Response

Through our Tax-Time Savings initiative, CA$H Maine and Boston Tax Help were in regular dialogue about how to use their respective savings volunteer programs to address the service delivery challenges created by COVID-19.

CA$H Maine built on its opportunity guides’ experience with savings outreach as part of Scan and Go drop-off tax assistance. This year they expanded their role to deliver both saving interventions and intake assistance through video conferences or over the phone. Boston Tax Help’s financial guides began offering the Financial Check-Up via video conference, over the phone, and at drop-off locations. They also assisted drop-off taxpayers with intake and virtual filers with tax document uploads.

Results

Boston Tax Help and CA$H Maine found that their dedicated savings volunteers could successfully promote savings at drop-off, over the phone, or by video conference, but the pandemic did create unique challenges. The rapid expansion of drop-offs and virtual return preparations forced volunteers to make things work on the fly, and as a result, savings volunteers weren’t always available at intake or able to consistently engage about savings.

Even with CA$H Maine’s previous success using opportunity guides at drop-off sites, engaging taxpayers about saving proved extremely difficult. The conversations were less effective at a six-foot distance wearing masks, and there was less time for those conversations. Even when taxpayers were allowed in facilities, there were no large waiting areas and intake needed to be completed quickly. CA$H Maine offered taxpayers, who dropped off tax information, the option of discussing savings by phone but few took advantage of that opportunity.

Savings volunteers were able to improve the intake process by working with taxpayers to provide complete information. This could be a challenge, however, when taxpayers had more complex circumstances, even when the savings volunteers were also certified as return preparers, and tax law changes in December and March also exacerbated intake challenges. Many savings volunteers completed training before these laws were enacted and had to quickly adjust to the changes. As intake then took more time, it was harder to be engaged around the importance of saving.

Looking Forward

Both organizations learned from their dedicated savings volunteer programs during the challenging 2021 filing season. Although savings volunteers didn’t achieve all of their objectives, using them at intake proved it could be effective in engaging clients on both return preparation and savings promotion. Having savings volunteers work remotely also opens up opportunities to utilize them in new ways. For example, it may help expand services, like the Financial Check-Up, beyond the tax site. Initiating intake and savings outreach over video or phone before taxpayers arrive at a tax site can also facilitate a more effective in-person engagement around the importance of saving.

Both CA$H Maine and Boston Tax Help are committed to continuing to use savings volunteers in the future with Virtual VITA for intake and for in-person tax assistance services. Because Virtual VITA requires more time, the ratio of savings volunteers to tax preparers may need to increase to ensure sufficient time for savings interactions.

Context

The City of Boston offers a wide array of services that can help people recover from economic hardship. Residents need a quick and convenient way to assess their financial needs and get referrals to available resources. The Boston Tax Help Coalition has worked for years to provide the Financial Check-Up, an interview that screens taxpayers for various financial challenges, at its Volunteer Income Tax Assistance (VITA) sites. An integral part of the Boston Builds Credit campaign, the check-up serves as a comprehensive version of the kinds of tools VITA programs use to help taxpayers improve their financial well-being, especially those who are not typically in contact with social service networks.

The Financial Check-Up is a pre-filing interview conducted by Boston Tax Help volunteers serving as financial guides. The check-up form is a set of tick boxes that help guide the interview and track outcomes, and the data from the form is generally entered directly into a Customer Relationship Management System. Financial guides discuss options for saving at tax time, and they make referrals to other supporting services, such as legal, debt management, immigration, housing, health care, and employment. Guides can also request and review credit reports and recommend steps to build positive credit histories, improve credit scores, and improve economic well-being. The Financial Check-Up has helped thousands of Bostonians improve their financial situation at tax time.

Challenge

The COVID-19 pandemic exacerbated economic disparities in the Boston area and highlighted the need for access to services and opportunities that empower residents and make savings possible. Many residents, who had never been unemployed, found themselves unable to work to do COVID restrictions or the related economic recession, and in Boston and other cities with high housing costs, a sudden loss of income can be particularly devastating.

The pandemic shift to Virtual VITA, which allowed taxpayers to not be physically present at the tax site, dramatically reduced communication between return preparers and taxpayers. The Financial Check-Up had almost always been conducted in person, and the pandemic disrupted not only tax assistance but also this assessment and referral tool.

Response

Boston Tax Help quickly created a financial check-up process via phone or video conference. This included establishing a virtual Private Branch Exchange (PBX) phone system, so financial guides could conduct the Financial Check-Up from anywhere without sharing their personal telephone numbers. Because social distancing required an enhanced process at intake, financial guides augmented the Financial Check-Up to include an assessment of taxpayer qualification for VITA services and the sufficiency of the documentation needed for return preparation.

Results

Boston Tax Help successfully delivered the Financial Check-Ups remotely. The augmented process to encompass intake also helped ensure that return preparers had all the required documents. Although Boston Tax Help overcame many challenges and completed several hundred Financial Check-Ups, it fell short of its initial goal of 1,000 financial assessments.

The rapid expansion of Virtual VITA proved to be a capacity challenge for the financial guides. Tax law changes during the 2021 filing season required a more extensive intake interview, forcing several process changes. The constant adjustments implemented as a result of the tax law changes caused tax-site coordinators to adapt in order to keep return preparation systems working effectively. This often limited the ability to deliver the assessment.

Looking Forward

Completing the Financial Check-Up by phone or video conference opens new possibilities. Because it can now be done from anywhere or at any time, it can be a viable stand-alone service or one that complements other social service programs offered by coalition members. In the process, financial guides can also deliver other interventions that encourage savings. Equipped with Virtual PBX, guides can also serve as the first point of contact to respond to taxpayer inquiries, helping tax sites to follow up quickly with taxpayers having filing issues. Foreseeing increased service demands, Boston Tax Help plans to increase the number of available financial guides.

Context

Wayne Metro's Volunteer Income Tax Assistance (VITA) program has a long history of encouraging taxpayers to save a portion of their tax refunds. The organization has used a mix of incentives to encourage tax-time saving, including a SaveYourRefund sweepstakes and prepaid gift cards for taxpayers, which is one of our promising practice for increasing saving at tax time : offering saving options more than once at the tax site.

Challenge

With the COVID-19 pandemic, Wayne Metro had to switch from its traditional in-person model to a combination of fully virtual tax preparation, where the taxpayer is never physically present at the tax site, as well as drive-up/drop-off assistance. This strategy kept taxpayers, volunteers, and staff members safe, but it dramatically reduced interaction between taxpayers and VITA volunteers. This eliminated many opportunities to offer savings options, including at the critical moment when taxpayers enter direct deposit information into their tax returns and could allocate some of their refund to savings. As a result, Wayne Metro needed to redefine what ‘multiple offers to save’ meant in this new service model.

Response

Wayne Metro identified two critical opportunities within its Virtual VITA process to encourage savings and promote their saving incentives. The first opportunity was the intake appointment, when staff or volunteers could talk with taxpayers about the amount they wanted to save and the special incentives available. The second was when staff and volunteers review the completed tax returns with taxpayers to ensure accuracy. Wayne Metro's seized those opportunities to share information about savings incentives and ask whether taxpayers wanted to split their refunds. The volunteer return preparers, who were trained on the importance of savings at tax time and the program's savings incentives, were also prepared to take advantage of any other opportunities to encourage savings if they had any communication with taxpayers.

Results

Despite the challenges of the pandemic and the limited opportunities for taxpayers and preparers to communicate, Wayne Metro helped taxpayers maintained the same level of savings in the 2021 filing season as they had in prior tax seasons. The program identified six reasons for this success:

1. Establishing taxpayer expectations around saving. Based on their experiences in previous years, returning customers expected to be offered savings incentives. They planned to save so they could again receive those rewards.
2. Forwarding direct deposit instructions to return preparers. At intake, taxpayers elected to save a specific amount and provided their direct deposit information so preparers already knew what portion of the refund to direct to savings.
3. Suggesting amounts to save at intake. Wayne Metro used the following anchor messages and prompts to help consumers focus on a savings goal:
   • If the taxpayer had used Form 8888 the year before to split direct deposits, suggest saving the same amount this year.
   • If the taxpayer claimed children as dependents and could anticipate a larger refund, but had not previously used Form 8888, suggest saving $500.
   • If the taxpayer didn’t claim children and could anticipate a smaller refund, suggesting $50.

1. Reassessing at quality review. Taxpayers who wanted to postpone a savings decision until knowing the size of their refund would learn the amount and decide whether to use Form 8888. Those who had decided at intake to save could adjust the allocation if the refund was smaller or larger than anticipated. Knowing there would be an opportunity to change their mind before the return was filed made taxpayers more comfortable making a saving plan at intake.
2. Training all volunteers on tax-time savings. All volunteers received training on the benefits of saving and Wayne Metro's savings incentives. Even though the pandemic li4mited direct conversations between preparers and taxpayers, the return preparers understood the savings options and could engage taxpayers when opportunities arose.
3. Offering an incentive. A $30 gift card for saving is a proven motivator. Wayne Metro secured private funding from financial institution partners to provide gift cards, and at the close of the reporting period, 150 gift cards were issued to savers.

Looking Forward

Intake and review will remain critical moments to encourage tax-time savings, even as more tax assistance is delivered in person. The lessons learned during the pandemic will help leverage those moments. In addition, as in-person assistance resumes and Virtual VITA methods evolve, the 2021 experience will enhance the quality of increased direct communications between return preparers and taxpayers.

Context

The Prince George’s Community College (PGCC) Volunteer Income Tax Assistance (VITA) program is a reliable source of quality and free tax assistance. During the COVID-19 pandemic, the program needed to find a solution for operating safely in a socially distanced environment. Most VITA programs switched to Virtual VITA, providing fully virtual services, in which the taxpayer weren’t required to be present, and drop-off locations were provided for delivering documents.

Challenge

Although Virtual VITA was a viable option for many programs, PGCC VITA had several concerns. Taxpayers sometimes didn’t know what documents they needed to provide and often struggle with uploading documents in a fully virtual process. Volunteer return preparers also often encountered difficulties reaching taxpayers to obtain missing information. Because PGCC was unable to provide a large space to gather safely, volunteers needed to work from home, which raised additional concerns about the security of home computers and internet connections

To utilize its strong base of experienced volunteers, avoid requiring taxpayers to upload information, and address the security challenges of volunteers working from home, the PGCC VITA program decided to use Facilitated Self-Assistance (FSA) as the primary service method. With FSA, taxpayers prepare and file their own returns using self-preparation software, and a VITA volunteer is available to answer questions in a timely manner via phone, e-mail, or text. Tax programs generally use FSA as an additional option for taxpayers who need no or minimal assistance with their returns. Taxpayers who participate in FSA sometimes don’t need any assistance in future years.

Although some VITA programs have offered FSA at workstations at local tax sites, it has more commonly been an at-home option. However, unlike the usual FSA clientele, PGCC needed to figure out how to use this mode of service delivery with taxpayers who have more complicated returns and little experience preparing them.

Response

PGCC decided to structure its FSA similar to a traditional in-person process. Taxpayers seeking assistance were given an appointment when a volunteer would meet them in an online video conference to provide step-by-step assistance with the online tax filing software. Because the taxpayer entered their own information, there was no need to upload or drop off documents. This reduced information security risks by limiting data sharing. Both the taxpayer and volunteer were safely working from home.

Taxpayers needed a computer or laptop with a microphone and reliable internet service. The PGCC program suggested taxpayers could have a trusted friend or family member join them on the call from home to help prepare the return. It also offered a drop-off option for taxpayers without computer access or reliable internet connection where taxpayers delivered documents to a PGCC staff member or volunteer on campus, and those returns were prepared in the usual tax site space.

PGCC VITA’s experienced volunteers provided step-by-step assistance, and they were able to respond when things didn’t go as planned. These volunteers know the importance of savings and financial empowerment, so they found moments during their engagement with taxpayers to talk about the other services of the Financial Empowerment Center.

Results

The PGCC VITA program was pleased with serving taxpayers using the remote FSA strategy and keeping everyone safe. Many taxpayers easily completed their returns with just a little instruction. The experienced volunteers were skilled in recognizing when a taxpayer might be struggling. The drop-off service option was a critical component because not every taxpayer was successful with FSA. For example, some taxpayers’ home computer setups ended up not being suited for video conferencing.

Although taxpayers were exposed to the opportunities of the Financial Empowerment Center when signing up for appointments and in conversations with the volunteers, the savings interventions didn’t work as effectively as in person. This was partly a product of having to develop a new return preparation process quickly. The program had to trust volunteers to find their moments rather than having a formal plan.

Looking Forward

PGCC VITA, like other tax programs, is looking forward to returning to in-person services so it will likely lower the profile of its FSA model next tax season. But, FSA will remain a reliable method for serving taxpayers who are homebound or unable to travel to atax site. FSA also offers a post-season option when tax sites are closed, and assistance resources are limited. FSA also represents an excellent opportunity to retain experienced volunteers looking for a more convenient volunteering option. With more lead time for training and planning, PGCC VITA anticipates being able to train FSA coaches more effectively in encouraging savings during the video interaction.

Context

Goodwill Industries of Tulsa is committed to promoting tax time as an opportunity for taxpayers to build savings. It utilizes many promising practices for increasing saving at tax time , including building commitment among staff and volunteers to encourage saving, making sure tax preparers know how to help consumers save while filing, and offering savings choices more than once at the tax site.

Goodwill Industries of Tulsa is also an innovator. It was an early partner of GetYourRefund.org , the non-profit service built by Code for America in partnership with VITA sites nationwide. GetYourRefund provides a technology platform for preparing tax returns remotely when taxpayers are unable to be physically present at a site. Goodwill Tulsa also offers facilitated self-assistance for taxpayers filing their own returns using OnLine Taxes (OLT) , one of the IRS Free File commercial preparer partners.

Challenge

The 2021 tax filing season was a challenge for all VITA programs, and this extended to tax-time savings work. The return preparation process – from intake to review – was more complicated, placing additional strains on volunteers’ time. Because taxpayer demand for tax preparation services typically exceeded organizational service capacity, there was understandable pressure to complete returns as quickly as possible. This left much less time for the personal engagement throughout the process, which is valuable in successfully promoting savings options.

The Virtual VITA process, facilitated by GetYourRefund and other similar tools, was of great assistance to programs including Goodwill in Tulsa during a period of social distancing, but the remote nature of the interactions with taxpayers limited opportunities to engage with potential savers.

Response

Despite the challenges, Goodwill Industries of Tulsa remained committed to tax-time savings. It worked with GetYourRefund to include savings messaging in the platform. This provided an additional avenue for communications before and during the return preparation process.

Recognizing the tremendous economic strains caused by the COVID-19 pandemic, Goodwill in Tulsa reached into the community to find residents in need of assistance. This included visits to homeless shelters and community meal programs. People served by these programs are often not a good match for VITA because required documents, including photo identification and Social Security cards, are often among the first things lost or stolen when someone is living on the streets. The additional benefit of the federal Economic Impact Payments (EIPs), however, had the potential to address critical financial needs during the pandemic.

Results

Using the OLT software, Goodwill in Tulsa was able to help taxpayers experiencing or at risk of homelessness. Most had memorized their Social Security numbers, had smart phones, and quite a few had bank accounts. Not only were they able to file returns to receive EIPs, but those with wage income could get withheld taxes refunded and sometimes claim an Earned Income Tax Credit. The tax program created new relationships with people who may benefit from financial support to gain some economic security.

The immediate results of using savings messaging in the virtual return preparation software were disappointing, but the experience clarified the promising practices of encouraging savings.

Looking Forward

Programs promoting tax-time savings tend to see growing success over time because taxpayers hear a consistent message, year after year, that can become part of their personal financial planning. The pandemic service disruption complicated this process but also underscored the value of taking a long-term view.

Goodwill Industries of Tulsa established new relationships with people experiencing homelessness, planting seeds for financial empowerment. Through its virtual services, the program realized the value of maintaining consistent communication as well as the great benefits from reinforcing text and email messaging with direct taxpayer contact. In the words of program staff: “It is considerably harder to ignore someone who looks like your mother or grandmother saying, face-to-face, ‘you should think about saving some of your refund’.”