Paul Parkison found a way to stay connected to Ball State students and do what he loves each year through the Volunteer Income Tax Assistant group.
"It's a way to help people, and it keeps me busy during the winter season," said Parkison, group coordinator and retired professor of accounting. "You meet some very interesting people, and they appreciate the service."
VITA has provided free tax services for Ball State students and retired Muncie residents for the past 10 to 15 years, Parkison said. Sponsored by the Internal Revenue Service, the organization consists of seven volunteers, including retired business people, accountants, bank officers and retired Ball State librarian Stan Hodge.
VITA will perform tax services in the Maring-Hunt and Kennedy Branches of the Muncie Public Library, as well as the Buley Community Center, through April 15. The organization completed nearly 90 returns Feb. 8 and 74 returns Feb. 9, Parkison said.
"It's a legal requirement that you file," he said. "Particularly with students, it's important because many of them can get a refund, so it makes sense that they file and get their money back."
HOW TO FILE
Like VITA, H&R Block also sees a number of Ball State students during the tax season, said Cathy Krimme, enrolled agent at the office on McGalliard Road. However, an increasing number of students are beginning to file their taxes online, which is convenient when using the simpler 1040A and 1040EZ forms, she said.
Filing a federal1040EZ form at H&R Block begins at $49. Filing the federal return online at www.hrblock.com costs $29.95, while the state return is $14.95, Krimme said. At Jackson Hewitt Tax Service the cost for filing both returns is typically between $25 and $50, Richard Norman, manager of Jackson Hewitt Tax Service, said.
No matter where or how they file, students still make common mistakes that end up costing them in their refund check or force them to have to re-file, he said.
The most common mistake among students is not knowing whether their parents are claiming them as dependents on their tax return. If their parents are claiming them, they cannot claim their own exemptions, and if they do so, the IRS will reject their return and they will have to file an amended return, Norman said.
RULES OF THE ROAD
Students who are claiming themselves need the 1098T form sent to their permanent address by Ball State's Bursar's Office in late January. The form shows the amount of tuition they were billed, their class fees and the grants and scholarships they received. Tuition tax credit can only be applied to students who didn't have enough grants and scholarships to cover their tuition, Krimme said.
Students who are paying on student loans also need a 1098E form from their lender, since student loan interest is tax deductible, she said.
Students who live off campus need to know the name and address of their landlord and the amount of rent they paid during the tax year in order to get that reduction on their return, Krimme said.
All students should have their Social Security number, picture ID and income statements, including bank account statements and information regarding any stocks or bonds they might have, Norman said.
They must "be prepared when they come in and know how they stand on exemptions and how they stand on credits for school," he said, "and preparation will go a lot smoother."
Many students who are self-employed, such as sales representatives, carpenters, electricians and business owners, don't realize they still owe taxes to the federal and state governments, Social Security and Medicare, Norman said.
"When it comes to being self-employed, a lot of students are not aware of a lot of the taxes they have to pay on that," he said. "When it comes to April 15, they find out they have to owe this money and it's kind of a shock to them because they are not aware of all the circumstances involved with being self-employed."
DUE DATE
For students who worked outside the state of Indiana during the past year, a non-resident return can easily be filed here in the state, Norman said.
The penalty for filing returns past the April 15 deadline appears in the form of interest on the amount of taxes owed. This doesn't affect students who are simply expecting refunds, but students should still make an effort to be timely, Norman said.
"It's just abiding by the law," he said. "I know there are a lot of procrastinators, but even they get it in by the 15 of April."
Senior Molly Sveum, speech pathology major, hasn't wasted any time with her taxes. Her mother filed them online as soon as she got her W2s in January, she said. However, she still doesn't understand the tax process or why it's important.
"I've just never been told really and never had to do it myself," Sveum said.
Many students need to familiarize themselves with the laws so they can reap the full benefits of filing and avoid run-ins with the government when they do eventually have to file for themselves, Norman said.
"Everyone owes taxes and they should pay them," Norman said. "You don't want to be obligated to the U.S. government, because they will get their money from you."
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