In response to queries it has recently received about paying volunteers including those with the Volunteer Income Tax Assistance program, the IRS has issued guidance on the matter.
The IRS said it allows VITA partners to use federal grant funds to provide stipends to volunteers within the volunteer return preparation program. The stipends are a fixed amount of money paid at regular intervals as a salary or to cover living expenses.
VITA grant funds cannot be used to provide compensation for tax assistor/preparer screener or quality reviewer positions, the IRS reminded. However, seven other positions, including interpreter, clerical workers and information technology specialists are eligible to receive salaries, wages and benefits as described in IRS publication 1084.
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The IRS guidance is not new or different than what is in the Volunteer Protection Act of 1997, said Debra Chandler, IRS national credit union relationship manager, who works with the VITA program. "They are written to be more comprehensible and to include the VITA grant piece," she explained.
In 2008, more than 530 credit unions were VITA partners helping low-to moderate-income persons receive $42 million in refunds, $16.2 million in earned income tax credits and $6.8 million in child tax credits.
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