A budgetary bright spot for VITA
President Obama’s call for substantially bolstering VITA reflects important recognition of the program’s great value to struggling taxpayers – and the VITA field’s strong advocacy efforts. And while chances of its enactment as-is are practically nil, it nonetheless challenges us to strengthen our advocacy work.
The federal matching grant for Volunteer Income Tax Assistance would grow to $18 million in Fiscal Year 2014, under the budget proposal the President unveiled Wednesday. That’s up from its $12 million level of recent years.
As we’ve shared countless times, VITA’s critical tax-prep help for low- and moderate-income taxpayers is drastically underfunded. VITA resources have largely plummeted at the state and local levels, while its federal funding has remained stagnant for three years – even as taxpayer needs and the government’s demands on the program have grown.
The President’s proposed budget also reflects several other priorities we hold dear, such as maintaining the current strength of three measures targeting their assistance to working families: the Earned Income Tax Credit, Child Tax Credit, and American Opportunity Tax Credit. Without overt action otherwise, the EITC and CTC weaken within five years, and the AOTC disappears.
The Internal Revenue Service’s taxpayer services and enforcement work, in general, would also gain from the President’s plans for the budget year that begins in October.
This new proposal adds to the mix of very disparate budget ideas that Congress already is examining.
Hashing-out a final budget is likely to require many more months of bickering at the Capitol. And factoring-in mandatory, across-the-board spending cuts – related to federal deficit reduction – will greatly complicate things.
Stay tuned for greater analysis of the President’s proposal, how it would affect working families, and ongoing budget negotiations.
For now, VITA programs should take heart: Some policymakers really are taking notice, underscoring the importance of our advocacy efforts.