Created by the NH Pro Bono Referral Program, the Low-Income Tax Project is designed to help low-income taxpayers with federal tax controversies under $50,000. A low-income taxpayer is someone whose income is not more than 250% of the federal poverty guidelines. So, a family of four making $59,625 or less qualifies for this program.
Types of Cases
- Deficiency Notices Did you receive a letter stating you owe the IRS money?
- Levies and Liens Did you receive a notice stating the IRS is going to place a levy on your wages or a lien on your property?
- Audits Did the IRS send you a notice saying you were being audited or they need more documentation?
- Innocent Spouse Relief & Injured Spouse Relief Does the IRS claim you owe taxes on income your husband/wife or ex-husband/wife earned? Or, does the IRS refuse to issue your refund because your husband/wife owes a debt from before you were married?
- Earned Income Tax Credit Has the IRS denied your claim for this credit? Are you having a problem getting all the documents the IRS has requested?
If you have questions or need assistance, please call Barbara G. Heggie, Esq., Low-Income Taxpayer Project Coordinator, at 603-228-6028.
To navigate through the questions below please select the + sign at the end of the blue bar.
Earned Income Tax Credit: Do You Qualify?
The Earned Income Tax Credit is for lower-income working individuals. It is a credit to reduce the taxes you owe and may even get you a refund! To qualify you must meet the following:
- You must have a social security number.
- You cannot be married filing separately unless you have been separated for 6 months.
- You must be a US citizen or LPR for the entire tax year.
- You cannot file a Form 2555 or 2555EZ.
- Your investment income cannot exceed $2,500.
- You must have earned income.
If you think you qualify, contact your local VITA site or call the IRS for more information. Special requirements may apply.
Refund Anticipation Loans
Refund Anticipation Loans, also known as RALs, are short-term loans, usually called cash advances by those giving the RALs, based on your anticipated tax refund. Tax preparers across the country market RALs as a fast and easy way to receive your tax refund. But in actuality, you pay a high interest rate on the loan and it only speeds up the refund by a week or two in comparison to electronic filing.
How do they work? Basically, a tax preparer fills out all the necessary forms you need to file your tax return. Then the tax preparer offers you a cash advance on your expected refund and you walk out the door with cash in hand.
The snag. Most of these cash advances charge anywhere from 67 to 774% APR for the two-week secured loan. Which means when you receive your refund money the same day your tax return was prepared you actually received your anticipated refund minus a high service fee. Based on a recent report from the National Consumer law Center and the Consumer Federation of America, for a refund of $1,980 you pay $75 for the advanced refund payment plus $40 electronic filing fee. In other words, you pay $115 to receive your refund early. Some studies have shown that low-income taxpayers pay in upwards of $267 in fee for using RALs.
There is an alternative. The IRS now offers an option where your refund is directly deposited into a bank account. To use the direct deposit option, all you need is the routing number of your bank and your account number. You can use this option whether you use electronic filing or paper filing. On average, people who choose to use direct deposit coupled with electronic filing receive their refunds in a week to two weeks from filing. So, you save $75 or more by using this option. Plus more and more tax preparers provide free electronic filing which will eliminate the $40 charge. Also, most of the IRS’s VITA and TCE sites (see below for more information) use electronic filing and if you qualify they will prepare your taxes for free.
So what should you do? Shop around. If you can wait a week or two, use the direct deposit option from the IRS. If you cannot wait, find out what the company charges for an advanced payment.
If you want more information about RALs, check the IRS website or call the IRS at 800-Tax-1040 or 800-829-1040.
Are You a Victim of Identity Theft?
Your identity may have been stolen if you receive a letter from the IRS stating or learn from a tax professional that
- you filed more than one tax return or someone has already filed using your information.
- you have a balance due, refund offset or have had collection actions taken against you for a year you did not file. and/or
- you received wages from an employer you have not worked for.
If you receive such a letter from the IRS and you suspect your identity has been stolen, respond immediately to the name, address, phone number or fax listed on the IRS letter or contact the IRS to determine if the letter is a legitimate IRS letter.
If you become the victim of identity theft outside of the tax system or believe you may be at risk due to a lost/stolen purse or wallet, questionable credit card activity or credit report, etc., you are encouraged to contact the IRS at the Identity Protection Specialized Unit, toll-free at 1-800-908-4490, so that the IRS can take steps to further secure your account.
The IPSU hours of Operation: Monday – Friday, 7 a.m. – 7 p.m. your local time (Alaska & Hawaii follow Pacific Time).
You will need to fill out the IRS Identity Theft Affidavit, Form 14039. Please be sure to write legibly and follow the instructions on the back of the form.
If you are a low-income taxpayer, and you think you’ve been a victim of identity theft, contact the Low-Income Taxpayer Project at 603-228-6028.
What is VITA?
Need assistance with your tax return?
Visit your local Volunteer Income Tax Assistance (VITA) Program.
Trained volunteers can help you prepare your tax return. They are trained to file for the Earned Income Tax Credit (EITC), Child Tax Credit, and Credit for the Elderly for which you may qualify.
In addition to free tax return preparation assistance, many sites also offer free electronic filing (e-filing). With this you could receive your refund in half the time it takes by filing on paper.
Filing taxes can be easy and free!
VITA sites are conveniently located in your community.
VITA volunteers provide free basic income tax return preparation to individuals with incomes of $34,000 and below. They prepare Forms 1040A, 1040EZ, and Schedule A and B.
Learn the locations, dates, and hours of the volunteer sites, by calling the IRS toll-free at 800-TAX-1040 or 800-829-1040.
This information was found at www.irs.gov.
The Benefits of VITA
- It’s Free.
- It’s Convenient.
- Refunds are faster if the site offers e-file.
Tax Assistance for the Elderly
Did you know the IRS provides tax preparation assistance to the elderly? The Tax Counseling for the Elderly (TCE) is much like the VITA program. However, this program is specifically designed to help taxpayers age 60 and above file their individual tax returns.
Each year, around February, TCE sites open up across the United States. Trained volunteers assist elderly taxpayers prepare their yearly tax returns for free. The volunteers are there to not only assist in filling out the forms, but to answer questions on Earned Income Tax Credit, tax credits for the elderly, and many other tax issues that face the elder population.
But where are these TCE sites? Since the sites do not open until February, no current list is available. However, you can call the IRS toll-free at 800-TAX-1040 or 800-829-1040 for more information and to find out where the closest TCE site is located.
This information was found at www.irs.gov.
Tax Court Calendar Call Program
The Low-Income Taxpayer Project is establishing a calendar call program with the United States Tax Court. To further the objectives of public service and judicial and administrative economy, volunteer practitioners participating in Tax Court calendar call programs will adhere to the following guidelines:
- “Each practitioner participating in a calendar call program shall be a member in good standing of the Bar of the Court.
- Each practitioner participating in a calendar call program shall arrive at the Court at least one hour before the beginning of a calendar call and inform the trial clerk of his or her availability to assist self-represented petitioners.
- A practitioner participating in a calendar call program shall not directly or indirectly suggest that a petitioner may retain the practitioner’s services for a fee, nor may the practitioner receive a fee from the petitioner.
- Practitioners participating in a calendar call program may engage in any activity necessary and appropriate to assist petitioners, consistent with all applicable codes of professional conduct, including, but not limited to: (1) providing procedural advice to petitioners who decide to proceed to trial, (2) consulting with petitioners regarding the merits of their cases and evaluating any settlement proposals from the Internal Revenue Service, (3) acting as a communicator or mediator between the parties in an effort to assist in resolving the case, and/or (4) entering an appearance with the Court on the petitioner’s behalf.
- Any practitioner participating in a calendar call program who has not (1) entered an appearance with the Court on the petitioner’s behalf, or (2) received a power of attorney from the petitioner authorizing the practitioner to represent the petitioner, shall conduct all case-related discussions with Internal Revenue Service attorneys in the presence of the petitioner and with the petitioner’s permission in order to alleviate any concerns regarding disclosure of petitioner information.
Tax Court Nonacademic Clinic Program
The Low-Income Taxpayer Project is establishing a nonacademic clinic program with the United States Tax Court. To further the objectives of public service and judicial and administrative economy, a practitioner accepting an assignment or referral of a Tax Court case from a nonacademic clinic shall satisfy the following requirements:
- Be a member in good standing of the Bar of the Court and adhere to the Courtâ€™s Rules of Practice and Procedure.
- Assume personal responsibility for meeting deadlines, monitoring case preparation, ensuring full compliance with the orders issued by the Court, and, in general, properly preparing a referred case for hearing, trial, or other disposition.
- A practitioner who is not employed by a nonacademic tax clinic and who accepts a case referral from a nonacademic clinic generally shall not accept any fee or payment as compensation for professional services rendered in that case. However, a nonacademic clinic may compensate a practitioner by paying a stipend and/or reimbursing the practitioner for actual costs (e.g., the $60.00 Court filing fee and costs of copying and transcripts).
- A practitioner who is employed by a nonacademic clinic or who accepts a case referral from a nonacademic clinic shall be lead counsel in the case, and the name, Bar number, and signature of that practitioner shall appear first on any petition filed with the Court. The names, Bar numbers, and signatures of other practitioners who are admitted to practice before the Court may also appear on the petition below the name of the lead counsel. A student may not sign a document submitted to the Court for filing. However, the names of students may appear in the petition or other documents filed in the case to the extent provided in section 4.d. below.
- If a petition has been filed with the Court, and the petitioner is not represented by counsel, a practitioner who is employed by a nonacademic clinic or a practitioner who accepts a case referral from a nonacademic clinic shall sign and file an entry of appearance with the Court pursuant to Rule 24(a)(3), Tax Court Rules of Practice and Procedure, and he or she shall be designated lead counsel in the case. Any other practitioner who is a member of the Bar of the Court who intends to appear as counsel in the case shall likewise file an entry of appearance.
- If a practitioner who is employed by a nonacademic clinic or who accepts a case referral from a nonacademic clinic finds it necessary or appropriate to withdraw from a case or effectuate a substitution of counsel, he or she must comply with the requirements of Rule 24(c) and (d), Tax Court Rules of Practice and Procedure.
Low-Income Taxpayer Project
Coordinator: Barbara G. Heggie, Esq.
Modest Means Legal Program
For those with “in-between” incomes, try the Modest Means Legal Program.
Senior Law Project
New Hampshire Legal Assistance offers help to persons age 60 or older through the Senior Law Project. The project has the capacity to serve elders who are housebound, isolated, or institutionalized.
US Internal Revenue Service
Call: 800-TAX-1040 or 800-829-1040
Legal Advice & Referral Center
Call: 800-639-5290 or 603-224-3333
The Legal Advice & Referral Center (LARC) does most of Pro Bono’s intakes. If you need legal assistance on issues other than tax, contact LARC.