This information is meant to give you ideas to think about with regards to the VISTA Living Allowance and Education Award and not
intended as a sole source for Tax Information. Be sure to consult a tax professional for specific and unique concerns regarding your taxes. There are many factors that impact an individual's tax situation such as: multiple sources of income, investments, marital status, charitable donations, real estate possessions, residency, etc
We have the presentation from our Taxes and VISTA webinar which you can also listen to here
. All the slides are available below.
Things to keep in mind when it comes to VISTA & Taxes:
- Tips from Volunteer Wisconsin
- VISTAs are eligible to utilize Volunteer Income Tax Assistance (VITA) Tax Sites. For more information on VITA sites in WI http://www.revenue.wi.gov/news/20110401_01.pdf , http://www.revenue.wi.gov/faqs/pcs/vita.html
- Free e-file: Beehive.org through H&R Block
- Federal Taxes are withheld from a VISTA's living allowance based on each VISTA's W-4 Withholding Form.
- State Taxes are not withheld from a VISTA's living allowance.
- The Education Award is taxed in the year that it is used.
- VISTAs who use their entire Education Award in one year, typically see a difference of around $500 in their tax liability for the year in which they use it. This varies based on an individual's other tax information. VISTAs have 7 years to use their Ed Award upon completion of service and can use it in varying amounts over that time period, so if a VISTA wants to use 1/7th of it during each of those years, they can, or all at once, or any combination is up to them.
- The Cash Stipend upon completion of service is considered taxable income in the year in which it is received.
- Federal taxes are withheld from the stipend at the time it is paid out.
- Be aware, if a VISTA has another job in the same tax year either before or after a VISTA term, the living allowance may have an impact on the VISTA's taxable income, possibly even putting the VISTA in a higher tax bracket.
- For FAQ on filing WI state taxes http://www.dor.state.wi.us/faqs/index.html