Learn to Teach
As a tax preparation student, I was confused by the language my instructor used.
He constantly used words and phrases such as deductions, tax credits, payments, withholdings, above-the-line deductions, reduce to zero but no more than zero, dollar per dollar, and other phrases and words that did not make sense to me until later. Ensuring that students understand the industry language is very important. Let me share a similar situation in sports.
For three years, my wife and I coached two soccer teams to volunteer at our local community center. It was extremely rewarding to put our hearts and minds together to train a bunch of kids in a sport I like, and my wife loves. I only played the game during my middle school years back in Mexico. My wife, on the other hand, has played soccer since she was about 6 or 7 years old. She was the first generation of girls playing with mixed teams, and she was the first soccer referee in Salinas, California. She knows the team’s positions and responsibilities. In the first two games, she kept telling the kids to kick the ball to the empty space, “al hueco, al hueco” she kept yelling in Spanish to our players. I told her that the kids did not understand what hueco meant. She used the language for so many years that she automatically thought everybody knew her meaning. So, we changed our strategy, and from then on, we used 5 to 10 minutes before each practice to teach the players the language in the game, the positions, the roles, and the importance of each of them in the game.
We taught them how to visualize a play in which the player with the ball will see his teammates and opponents and then look for an empty space and kick the ball there. His/her teammates must do the same, look for an empty space, and move there to get the ball. We taught them to visualize a triangulated movement. After a while, the triangulated movement became second nature for them.
To understand the importance of using your creativity.
Learn how to use colors and shapes to represent concepts and categories.
You will dare to try!
To reflect on
It is important that you understand that as a tax instructor you must combine teaching and coaching techniques to train your students effectively. Teach them the concept, then guide them to do the practice.
When I started teaching taxes, I tried to explain to my students the language we use in this industry and the role each of those concepts plays in the tax return. I helped them understand those concepts to prepare them to play the game. All these concepts, phrases, and words are what my wife called “el hueco,” the empty space in which you (the instructor) must kick the ball; the other part is your teammate (your student); he/she must know when to move into that empty space to get the ball.
Learn to teach
Today, I will teach you how to use simple techniques you will eventually modify to your advantage and your own style. Let’s teach the difference between deductions and tax credits. First, I will define each term and describe its impact on the tax return and the taxpayer’s income. Then, I will talk about their differences and similarities if there are any.
Deductions are amounts that we, as taxpayers, can use to reduce our income at various stages of the tax return and before we calculate the tax amount we owe. The taxpayer must individually qualify for each deduction for every item in the tax return. Deductions include the following deductions:
- Standard deductions
- Itemized deductions
- The so-called above-the-line deductions that include
- Work-related deductions
- Education deductions
- Health care deductions
- Investment-related deductions
The first group of deductions that applies to your gross income is the above-the-line deductions called adjustments to income. These deductions reduce the gross income and generate the Adjusted Gross Income. Then, either the standard deductions or the itemized deductions reduce the adjusted Gross Income further to generate the taxable income. All these deductions are on page 1, form 1040.
To create a simple visual effect, I use form 1040 as an example. Showed students that all the deductions are in lines 10 to 13 on Form 1040.
On the other hand, payments and tax credits are amounts that reduce the taxpayer’s tax liability, which occurs on page 2. Payments are amounts that the taxpayer pays in advance, such as the Estimated Tax Payments, income tax withholdings, and other payments described on Schedule 3, Form 1040. Ensure your students understand those advance tax payments to cover their end-of-the-year taxes.
Payments include items such as:
- Estimated Tax Payments.
- Income Tax Withholding.
- All the items on lines 9 to 13z, Part II, Schedule 3, Form 1040.
We will have a second part to explain how to teach the process through a small PowerPoint presentation and a video.
Tax Credits include nonrefundable, partially refundable, and refundable credits detailed in lines 1 to 6z, Part I, Schedule 3, Form 1040, and some in Part II, Schedule 3, as previously stated, and more.
Tax Credits include:
- Child Tax Credit
- Additional Child Tax Credit
- Earned Income Credit
- Foreign tax credit.
- Credits for child and dependent care expenses
- Education credits
- Retirement saving contributions
- Residential energy credits
- Other refundable, nonrefundable credits
Here is a graphic you can use so students can visualize the effect of payments and tax credits.
When I teach, I always use different shapes to represent concepts and contrasting colors to separate categories. I love playing with options! If you have an idea of how to enhance your student’s learning, go ahead! Go ahead be creative!
Fernando Cabrera, National Education Coordinator of Latino Tax Pro