Alaskans, Others May Soon Lose Free Tax Help
TL/DR –
The IRS budget and workforce are at risk of severe cuts under President Trump and Elon Musk’s Department of Government Efficiency (DOGE). A budget cut could drill down on free tax-preparation services such as the Volunteer Income Tax Assistance (VITA) grant program, which awarded $53m in grants to volunteers and organizations who helped taxpayers file over 2.1m tax returns in 2023. The VITA program and its counterpart, Tax Counseling for the Elderly (TCE), are important services that simplify tax filings and allow eligible taxpayers to get maximum refunds.
Trump & Musk’s IRS Budget Cuts and a Viable Service That Could Prevail
A woman from Kotzebue, Alaska spent $2,000 last year for her 1040 tax return preparation. She traveled 547 miles to Anchorage and paid a $500 tax prep fee. With no local tax pros, she relied on volunteers from the lower 48 states, as heard on KOTZ-AM. The future of these free services is uncertain due to potential deep cuts in the IRS’s budget by President Trump and Elon Musk’s Department of Government Efficiency (DOGE). IRS hiring freeze and layoffs of 7,000 workers are already causing concern.
Despite no IRS presence in Kotzebue, volunteers like us helped residents after undergoing a week’s worth of special training. Our effort is part of the IRS’ Volunteer Income Tax Assistance (VITA) grant program, which aids seniors and those with incomes below $67,000 or specific circumstances. The IRS awarded $53 million in such grants to 315 VITA organizations and 41 groups for the 2025 fiscal year. But, whether VITA and Tax Counseling for the Elderly (TCE) would survive the looming IRS budget cuts is unclear.
Family-specific tax complications in Alaska underscore the importance of taxpayer service. As a tax lawyer, it’s astounding how many tax traps exist for ordinary Americans. The VITA volunteers made a significant difference for many families who qualified for credits and refunds but couldn’t afford a paid preparer.
In rural Alaska, practical tax filing problems are common. For instance, getting mail can be a challenge, affecting the delivery of tax forms. Encouraging tax refunds by direct deposit, introducing IRS Direct Pay and offering some tax counseling services often became part of our job.
Whether we would be able to return next year is uncertain due to potential budget constraints. However, free tax services like those offered by IRS Free File and Direct File are still available for now. The U.S. income tax system relies on voluntary compliance, and programs like VITA contribute to maintaining that.
Near the end of our trip, a blizzard hit and closed schools, but villagers still found their way to the community center to get their taxes done. It showed their commitment to fulfilling their civic duty. VITA and TCE services are vital for those taxpayers who find tax filing challenging, and their existence depends on the future budget decisions.
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