Tax Return Deadline April 15
For most Americans, filing taxes is right up there with visiting a dentist and people tend to put it off as long as they can. However, procrastination may incur hefty penalties. The filing deadline for most people is April 15 (April 17 for Maine and Massachusetts residents) unless you file for a six-month extension. You must pay any taxes you owe for 2023 by the filing deadline, even if you file for an extension. Otherwise, you may face a late payment penalty — with interest.
At Ethnic Media Services’ annual tax season briefing, on March 22, Kevin Morehead, Deputy Commissioner of the IRS Wage and Investment Division, explains what to keep in mind when you file your taxes this year.
The IRS is expecting to receive 146 million returns by the close of filing season on April 15th. “We at the IRS are committed to improving the customer experience. This includes increasing help available on the toll-free line, specifically, our main taxpayer helpline and expanding the customer callback feature designed to significantly reduce wait times. That’s to continue for the rest of this filing season,” says Morehead.
Taxpayers have several options to file their taxes
You can do them yourself, use tax software, or use a professional service like a tax preparer, a certified public accountant or an enrolled agent (use caution when choosing one as you are giving them sensitive personal information.) You may also be able to get free tax prep help through the IRS Volunteer Income Tax Assistance (VIDA) for the Elderly programs if you qualify. Check the IRS database to find out if it’s available where you live.
This filing season, for the first time, eligible taxpayers can file their taxes electronically, directly, and for free with the Internal Revenue Service (IRS). The new tax filing initiative is known as the IRS Direct File pilot program. It’s part of the IRS’s efforts to provide a free, government-operated tax filing service, supported by funding from the Inflation Reduction Act of 2022.
The pilot program is initially available to residents of 12 states: Arizona, California, Florida, Massachusetts, Nevada, New Hampshire, New York, South Dakota, Tennessee, Texas, Washington, and Wyoming. Eligibility is primarily for those with simpler tax filing needs, such as reporting W-2 income, Social Security benefits, unemployment benefits, and interest income of up to $1,500. To use IRS Direct File, eligible taxpayers can sign up or check their eligibility on the directfile.irs.gov website.
While most taxpayers can file their tax returns without ever talking to the IRS. “We know that sometimes people need help. So, our taxpayer assistance centers have extended hours and Saturday events to help more people in person across the country. At our taxpayer assistance centers, people meet with IRS employees,” says Morehead. Help is provided in several languages and it is helpful to visit the event page at www.irs.gov for the most up-to-date information.
Gather Information
The first thing you want to do is to gather all your documents, some examples are:
- Social Security numbers for yourself, as well as for your spouse and dependents, if any.
- W-2 form, which tells how much you earned in the past year and how much you already paid in taxes.
- 1099 forms, which are a record that some entity or person
- Retirement account contributions / Charitable donations.
- Property taxes and mortgage interest
- Other expenses like medical/educational/ student loan expenses
- Last year’s federal and state tax returns
If you forget a deduction when you file, you have up to three years from the tax-filing deadline to file an amended return if you left something out or realize you made a mistake. File Form 1040X with the changes and submit any additional forms affected by the change.
To make filing as stress free as possible, file electronically
You’ll usually get your refund faster and have the IRS deposit it directly into your bank account to avoid any fraud. You can check the status of your refund after you file by using the IRS “Where’s My Refund?” tool. The refund tool is available in English and in Spanish and provides taxpayers with 3 key pieces of information:
- The IRS confirmation of receiving a federal tax return
- Approval of the tax return and refund
- An issuing date of the approved tax refund
What if I get Audited?
Selection for an audit does not always suggest there’s a problem. According to Morehead, an audit is simply a review of your accounts to ensure information is reported correctly according to the tax laws and to verify the reported amount of tax is correct.
While simple math errors don’t usually trigger a full-blown examination by the IRS, they will garner extra scrutiny and slow down the completion of your return. Entering the wrong Social Security number, transposing the numbers on income, etc. can be cumbersome mistakes. Filing electronically minimizes these errors by pulling a lot of information from previous returns and letting you load your W-2s or 1099s directly into the system.
There are three types of IRS audits: mail, office, and field audits. There’s also another way the IRS questions tax returns, but it’s not technically an audit. It’s the under-reporter inquiry, or CP2000 notice, and it’s very common.
Watch out! Scams Are Rampant
It is important to be very vigilant as scammers are luring you with claims in relation to your unclaimed refund. “We want taxpayers to be on the lookout for a scam that tries to mislead people into believing they are owed a refund. The new game involves mail coming in a cardboard envelope from a delivery service. The enclosed letter includes the IRS master head with contact information and a phone number. That does not belong to the IRS,” warns Morehead.
The IRS also warns taxpayers to avoid tax return preparation known as ghost prepares. A ghost preparer is someone who doesn’t sign tax returns they prepare. Instead, they print the return and tell the taxpayer to sign and mail it to the IRS or, for e-filed returns, they prepare but refuse to digitally sign it as the paid preparer.
Not signing a return is a red flag. That tax preparer may be looking to make a quick profit by promising a big refund or charging fees based on the size of the refund. “Taxpayers are often baited by these prepares with promises of larger refunds. So, remember, if it sounds too good to be true, it probably is,” warns Morehead.
Recent immigrants are often targeted by individuals calling and impersonating IRS agents. The phone scam continues to make the rounds. Callers are aggressive and pose as IRS agents using fake names and bogus IRS badge numbers in the hope of stealing taxpayer money or personal information. They may know a lot about their targets and they usually alter the caller ID to make it look like the IRS is calling. Victims are told they owe money to the IRS. And it must be paid promptly through a gift card or wire transfer. Victims may be threatened with arrest, deportation, or suspension of a business or driver’s license.
Another scam to look out for is when the victims may be told they have a refund due to trick them into sharing private information. If the phone isn’t answered, the scammers often leave an urgent callback request. “Unfortunately, criminals are always embedding new ways to trick people. An important rule to remember is the IRS does not initiate contact with taxpayers by email, text message, or social media channels to request personal or financial information,” adds Morehead.
Photo by Karolina Grabowska: https://www.pexels.com/photo/quote-box-ontop-of-stack-of-paper-bills-4386372/
