Category Archives: Income Tax

2017 Tax Delay For Earned Income Tax Credit and Additional Child Tax Credit Taxpayers

2017 Tax Delay For Earned Income Tax Credit and Additional Child Tax Credit Taxpayers

There is a new federal law enacted that will cause a 2017 Tax Delay for those claiming the earned income credit as well as the Additional Child Tax Credit. The IRS has started releasing this information to prepare taxpayers for a potential 2017 Tax Delay For Earned Income Tax Credit and Additional Child Tax Credit Taxpayers.   Continue reading

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IRS outage could cause 2016 Tax Delay

IRS outage could cause 2016 Tax Delay

Taxpayers filing their taxes online could face serious delays in getting a refund. IRS outage could cause 2016 Tax Delay.

An unspecified number of online tax processing systems, including the “Where’s My Refund” tool, were down on Wednesday as a result of a “hardware failure,” the IRS said in a statement.

Computer Problems at IRS Shut Down E-File System

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State Tax Refunds May Be Delayed by Security Precautions in 2016

State Tax Refunds May Be Delayed by Security Precautions in 2016

State Tax Refunds May Be Delayed by Security Precautions in 2016.  SOME taxpayers may get their state income tax refunds a little later this year because of extra security measures aimed at preventing fraud.

Some states have warned taxpayers not to expect refunds until after March 1, regardless of how early they file their returns. The Internal Revenue Service has not issued any notice of delays in issuing federal income tax refunds for this year’s filing season, which begins Tuesday. The I.R.S. says about 90 percent of refunds are issued within 21 days. Continue reading

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Looking For Your Tax Refund? What You Need To Know So Far For 2014

It’s that time of year again. You know, the time of year where you’re relegated to doing a lot of waiting. And waiting. It’s hard, I know, between the delayed opening for tax season and the terrible weather that we’re experiencing in parts of the country. Things are moving kind of slow. Plus side? They are moving. Here’s the skinny so far: Continue reading

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IRS Delays Start of 2014 U.S. Tax Filing Citing Shutdown

IRS Delays Start of 2014 U.S. Tax Filing Citing ShutdownThe U.S. Internal Revenue Service delayed the start of the tax-filing season for one to two weeks, citing the recent 16-day federal government shutdown.

The IRS, which had been scheduled to open filing Jan. 21, 2014, will now begin accepting returns for tax year 2013 as early as Jan. 28. The agency will make a final decision on the date in December, according to a statement today.

“Readying our systems to handle the tax season is an intricate, detailed process, and we must take the time to get it right,” Danny Werfel, the acting IRS commissioner, said in the statement.

This is the second year in a row that the IRS has postponed the filing season. Returns for 2012 were accepted starting on Jan. 30 after Congress delayed setting some tax policies.

“Considering the IRS has dealt with much larger changes on far shorter notice over the past years without delay, its reasons are suspect,” Sarah Swinehart, a spokeswoman for the Republican-led House Ways and Means Committee, said in an e-mail.

The IRS furloughed more than 90 percent of its employees during the shutdown, which began Oct. 1 when Congress was unable to pass a spending bill and ended after midnight Oct. 17.

‘Adds Insult’

“This is yet another unfortunate effect of a shutdown that Republicans should have never caused,” Representative Sander Levin of Michigan, the top Democrat on the Ways and Means Committee, said in a statement. “This tax-filing delay just adds insult to injury for Americans hoping to get a jump-start on their tax refunds in January.”

The delay won’t alter the April 15 deadline for taxpayers to file their returns or seek extensions.

At the start of the filing season, the IRS largely issues refunds to taxpayers who file as soon as they can. This year, the IRS issued $135 billion in refunds from Jan. 30 to March 1. That’s more than was paid from March 2 to May 10, when the agency received 50 percent more returns.

Delaying refunds could have an additional consequence in 2014. The U.S. debt limit is suspended through Feb. 7, and changes in the government’s projected spending after that date will affect the timing of how long the Treasury Department’s extraordinary measures to prevent a default will last.

Because the government may issue more refunds after Feb. 7 than previously anticipated, a potential lapse in borrowing authority could come a few days sooner than projected, said Loren Adler, research director at the Committee for a Responsible Federal Budget in Washington.

The delayed start of tax-filing season probably will create a backlog of potential returns for the start date, rather than delaying all returns equally.

“Those are folks who are trying to do this as soon as their books are in order,” Adler said.

The Bipartisan Policy Center projects that the U.S. will run out of borrowing authority between the end of February and mid-March 2014.

Discuss this and more in the Income Tax Forums.

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IRS Shutdown? Income Tax Deadline Remains In Effect

IRS Shutdown?

The October 15th Deadline Remains in Effect for Taxpayers Who Requested a Six-month Extension to File Tax Return.

Just because IRS employees are not available to answer phones or issue refunds, due to the current lapse in federal appropriations does not mean filing deadlines and payment due dates can be delayed.  IRS warns all taxpayers of the continuing requirement to meet their tax obligations as normal. Individuals and businesses should keep filing their tax returns and making deposits with the IRS, as required by law.

Many of the more than 12 million individuals who requested an automatic six-month extension earlier this year have yet to file their Form 1040 for 2012. Though Oct. 15 is the last day for most people to file, some groups still have more time, including members of the military and others serving in Afghanistan or other combat zone localities who typically have until at least 180 days after they leave the combat zone to both file returns and pay any taxes due. People with extensions in parts of Colorado affected by severe storms, flooding, landslides and mudslides also have more time, until Dec. 2, 2013, to file and pay.

The IRS offered several reminders for taxpayers during the current appropriations lapse:

  • Taxpayers are encouraged to file their returns electronically using IRS e-file or the Free File system to reduce the chance of errors.
  • Taxpayers can file their tax returns electronically or on paper. Payments accompanying paper and e-filed tax returns will be accepted and processed as the IRS receives them. Tax refunds will not be issued until normal government operations resume.
  • IRS operations are limited during the appropriations lapse, with live assistors on the phones and at Taxpayer Assistance Centers unavailable. However,www.IRS.gov and most automated toll-free telephone applications remain operational.
  • Tax software companies, tax practitioners and Free File remain available to assist with taxes during this period.

E-file Now – The IRS urged taxpayers to choose the speed and convenience of electronic filing. IRS e-file is fast, accurate and secure, making it an ideal option for those rushing to meet the Oct. 15 deadline. The tax agency verifies receipt of an e-filed return, and people who file electronically make fewer mistakes too.   Of the nearly 141.6 million returns received by the IRS so far this year, 83.5 percent or just over 118.2 million have been e-filed.

Anyone expecting a refund can get it sooner by choosing direct deposit. Taxpayers can choose to have their refunds deposited into as many as three accounts. See Form 8888 for details.

Payment Options – Taxpayers can e-pay what they owe, either online or by phone, through the Electronic Federal Tax Payment System (EFTPS), by electronic funds withdrawal or with a credit or debit card. There is no IRS fee for any of these services, but for debit and credit card payments only, the private-sector card processors do charge a convenience fee. For those who itemize their deductions, these fees can be claimed on next year’s Schedule A Line 23. Those who choose to pay by check or money order should make the payment out to the “United States Treasury”.

Taxpayers must be sure to file their return by Oct. 15, even if they can’t pay the full amount due. Doing so will avoid the late-filing penalty, normally five percent per month, that would otherwise apply to any unpaid balance after Oct. 15. However, interest, currently at the rate of 3 percent per year compounded daily, and late-payment penalties, normally 0.5 percent per month, will continue to accrue.

For additional information seehttp://www.irs.gov/uac/Newsroom/Reminder:-Oct.-15-Tax-Deadline-Remains-During-Appropriations-Lapse

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Late Start for I.R.S. 2012 Income Tax Processing

Bad news coming out of the IRS today. The IRS will not start processing 2012 Income Tax Returns until January 30th, 2013.

Here is the article from the IRS:

IRS Plans Jan. 30 Tax Season Opening For 1040 Filers

IR-2013-2, Jan. 8, 2013

WASHINGTON — Following the January tax law changes made by Congress under the American Taxpayer Relief Act (ATRA), the Internal Revenue Service announced today it plans to open the 2013 filing season and begin processing individual income tax returns on Jan. 30.

The IRS will begin accepting tax returns on that date after updating forms and completing programming and testing of its processing systems. This will reflect the bulk of the late tax law changes enacted Jan. 2. The announcement means that the vast majority of tax filers — more than 120 million households — should be able to start filing tax returns starting Jan 30.

The IRS estimates that remaining households will be able to start filing in late February or into March because of the need for more extensive form and processing systems changes. This group includes people claiming residential energy credits, depreciation of property or general business credits. Most of those in this group file more complex tax returns and typically file closer to the April 15 deadline or obtain an extension.

“We have worked hard to open tax season as soon as possible,” IRS Acting Commissioner Steven T. Miller said. “This date ensures we have the time we need to update and test our processing systems.”

The IRS will not process paper tax returns before the anticipated Jan. 30 opening date. There is no advantage to filing on paper before the opening date, and taxpayers will receive their tax refunds much faster by using e-file with direct deposit.

“The best option for taxpayers is to file electronically,” Miller said.

The opening of the filing season follows passage by Congress of an extensive set of tax changes in ATRA on Jan. 1, 2013, with many affecting tax returns for 2012. While the IRS worked to anticipate the late tax law changes as much as possible, the final law required that the IRS update forms and instructions as well as make critical processing system adjustments before it can begin accepting tax returns.

The IRS originally planned to open electronic filing this year on Jan. 22; more than 80 percent of taxpayers filed electronically last year.

Who Can File Starting Jan. 30?

The IRS anticipates that the vast majority of all taxpayers can file starting Jan. 30, regardless of whether they file electronically or on paper. The IRS will be able to accept tax returns affected by the late Alternative Minimum Tax (AMT) patch as well as the three major “extender” provisions for people claiming the state and local sales tax deduction, higher education tuition and fees deduction and educator expenses deduction.

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