Barbara Kim Stanton
Hawai‘i Herald Columnist
It’s that time of the year again when, with pencil and calculator in hand, we go through a year’s worth of receipts, statements and other documents to file our taxes.
Fortunately, AARP Foundation Tax-Aide volunteers are available to help people prepare their taxes for free at locations statewide. The service is especially for low- and moderate-income taxpayers 50 and older, and you don’t have to be a member to use the service.
Because of last year’s tax reform changes, filing your taxes this year could be a lot simpler or more complicated depending on your circumstances.
The tax law changes should make it easier for some, as fewer taxpayers will need to itemize and fill out the long form. That’s because the standard deduction has nearly doubled to $12,000 for single filers and to $24,000 for married couples filing jointly. Additionally, people 65 and older who are single can deduct another $1,600, while couples filing jointly are allowed an additional $1,300 deduction for each spouse of that age.
The increase means that if your itemized tax deductions are less than the standard deduction, you just need to file a simple form.
On the flipside, if you do itemize, there are a lot of changes, and because state tax laws did not change, it’s possible that some filers will file a simple federal form, but still have to itemize for their state return.
The biggest change for those who itemize is the elimination of the personal deduction. Before 2018, you could take $4,050 off of your income for yourself, your spouse and each dependent. The home equity interest deduction also went away unless your equity loan was used to improve your home. Independent contractors and small business owners can also get a 20 percent federal tax deduction on their business income. So they only pay taxes on $80 of every $100 they make up to certain limits.
The Child Tax Credit doubled from $1,000 to $2,000 and there’s a new $500 dependent tax credit that can be used by caregivers who have a parent or other adult who depends on them. In addition, more taxpayers should qualify for the Earned Income Tax Credit.
AARP Foundation Tax-Aide volunteers are trained and IRS-certified every year to help you navigate the changes in the tax law. Last year in Hawai‘i, 236 AARP Foundation Tax-Aide volunteers helped nearly 13,000 people file their federal and state tax returns. Our volunteers helped people get back more than $4.7 million in income tax refunds, including $867,511 in Earned Income Tax Credits.
To find a Tax-Aide site and the hours of operation, go to AARP.org/Taxaide or call 1-888-AARP NOW (1-888-227-7669). Information on what documents to bring, whether the location requires appointments and online tax assistance is also available.
Our service is popular, so arrive early and bring all your documents. Be patient if you have to wait. Goodwill Hawaii and VITA also offer free volunteer tax assistance for low-income residents. You can check their websites (higoodwill.org or hawaiitaxhelp.org) for more information.
Barbara Kim Stanton has been the state director of AARP Hawai‘i since 2005. She writes about living a life of real possibilities, where age is not a limit and experience equals wisdom.