This post was updated on Feb. 2, 2019. The 2019 tax filing season has been officially underway for about a week. Millions of folks have already filed their returns. The Ally Bank fortune cookie I got at FinCon16 last September was already planning for this filing season. And yes, after acknowledging the good tax advice, I ate the cookie! These are, for the most part, the folks who are expecting refunds. Some taxpayers, however, wait to file even if they are getting money back from Uncle Sam. Form-ulaic delay: Why the delay? In a lot of cases, folks haven't yet... Read more →
January 2017
UPDATE, Jan. 30, 2021: This post and table now includes Form 1099-NEC. Last used in 1982, beginning with the 2021 tax filing season, the 1099-NEC replaces 1099-MISC used to report compensation to individuals who are not employees. The 1099-MISC remains for reporting other types of payments. Jan. 31 is a key annual tax deadline. It’s the date employers must send W-2 and 1099-MISC forms to folks who received at least $600 in compensation the preceding tax year. Jan. 31 also now is the deadline for employers to also submit that W-2 and 1099-MISC data to the Social Security Administration (SSA).... Read more →
Remember that tax scam last spring where crooks posing as company executives sent emails asking for workers' payroll data? It was the one that fooled lots of folks, including a Milwaukee Bucks employee who thought that the message really did come from the NBA franchise's president. That chagrined Bucks' staffer sent the phishing crook 2015 tax year data on the team's employees, including his rank-and-file colleagues and highly-paid professional basketball players. Well, that tax scam is back. Email spoofs company CEO: The Internal Revenue Service says the email scam is now making its way across the nation for a second... Read more →
Every year, the Internal Revenue Service makes a concerted effort to hand out more Earned Income Tax Credit (EITC) money. The reason, says the tax agency, is that around 20 percent of eligible filers consistently fail to file for this refundable tax credit. But what about those who do claim the EITC? The IRS says that nationwide last year, 27 million U.S. workers and their families got $67 billion thanks to this tax credit for lower- and middle-income workers. Where EITC money goes: Not surprisingly, the most populated states account for the most EITC claims and actual dollars returned to... Read more →
The Earned Income Tax Credit, or EITC, is one of the filing claims that is delaying federal (and in some cases, state) tax refunds this year. But even if you have to wait a few extra weeks to get your refund from Uncle Sam (or your state tax office), filing for the EITC is usually worth it. It's worth more than $6,000 for some filers. And all or some of that money could be as a tax refund. Why credits rule: Like all tax credits, the EITC is a dollar-for-dollar offset of any tax you owe. Let's say your tax... Read more →
Most taxpayers who file federal returns also must do the same for their state taxes. And most those state filings tend to conform to federal laws. That means that, among other things, state deadlines usually are the same as the ones set by the Internal Revenue Service. This year, it also means that state tax refunds, like their federal counterparts, are likely to be later than usual. Feb. 15 delay for certain refunds: Millions of taxpayers who claim the federal Earned Income or additional child tax credits already are dealing with delayed refund checks from Uncle Sam. The IRS is... Read more →
As the Internal Revenue Service began accepting tax returns this week, the agency's commissioner noted that "the dedicated employees of the IRS look forward to serving taxpayers this filing season." IRS Commissioner John Koskinen's staff, however, apparently is not going to be as large this year as he had planned. Some federal job seekers got an icy reception after President Donald Trump instituted a federal hiring freeze this week. (Icy branch photo by J. Carmichael via Wikimedia Commons) On Jan. 23, the same day that the 2017 tax filing season officially began, President Donald Trump instituted an immediate hiring freeze... Read more →
This post was updated March 22, 2018. Do you have to file a return? Don't shoot the messenger, but the answer usually is yes. If you are a U.S. citizen or resident who made money last year, whether you must tell the Internal Revenue Service about it depends on three things: Your gross income, Your filing status, and Your age. The IRS created the table (shown as Chart A in the 2017 Form 1040 instructions) below to give you an idea of whether you should start getting your filing material together. 2017 Filing Requirements for Most Taxpayers If your filing... Read more →
Tax filing season 2017 opens today! Yes, that is cheering you're hearing. It's from folks who file their taxes early, usually because they are getting refunds. They also are fortunate that they have all the materials they need to fill out their returns. The key document for most taxpayers is their W-2 form. Employers aren't required to get these out until the end of the month, but some companies are quite efficient. And some taxpayers this year are going to discover something new on their W-2s. Verification code addition: Around 50 million of these officially named Wage and Income Statements... Read more →
Not to run Donald J. Trump's penchant for tax secrecy into the ground -- OK, maybe just dig a shallow little hole and kick some on dirt on it -- but I couldn't resist the latest bit of info about the new prez's still concealed tax returns. We are not now or ever -- that's never, just in case you're unsure in our new alternate facts world -- going to see his tax returns. Click image to watch interview on YouTube. During an interview this morning on ABC's "This Week with George Stephanopoulos" political news show, White House counselor Kellyanne... Read more →
When Donald J. Trump assumed the U.S. presidency at noon on Friday, Jan. 20, he and his staff also took over the White House website. This is the only glimpse of Donald Trump's taxes the new president has provided, a photo via Twitter of him signing his purported 2014 federal return on Oct. 15, 2015. Although the 45th president's people made some major changes to the content Trump's predecessor had posted, they did leave one feature untouched, the We the People petition generator. This option lets people petition the White House for action on whatever is near and dear to... Read more →
NOTE: This post was updated on Jan. 13, 2019, to reflect Free File changes for the 2019 tax-filing season. Free File 2019 opened on Jan. 11. Have you tried it out yet? The partnership between Uncle Sam and the private tax software industry has been around since 2003. This year, a dozen companies are offering their services to eligible taxpayers. The Internal Revenue Service and the Free File Alliance say these participating software manufactures should meet the filing needs of 70 percent of the more than 150,000 million taxpayers expected to send in 2018 tax returns this year. Does free... Read more →
A Jacksonville, Florida, mother and father finally saw their daughter after being separated for 18 years. Kamiyah Mobley was known as Alexis Manigo when she took this undated Instagram selfie with Gloria Williams, the woman she grew up thinking was her birth mother. Kamiyah Mobley was a newborn when Gloria Williams, 51, allegedly posed as a nurse and took her from her birth mother in Jacksonville, Florida. Now Kamiyah, who grew up as Alexis Manigo, is getting to know her birth parents, Shanara Mobley and Craig Aiken. The young woman, however, says the woman accused of taking her when she... Read more →
Rep. Mick Mulvaney is going to have to answer some nanny tax questions if he hopes to become President-elect Donald Trump's budget director. Rep. Mick Mulvaney speaks to some of his South Carolina constituents on last September's Constitution Day. (Photo by Erik B. Corcoran via Twitter) The South Carolina Republican was elected to Congress in 2010 as part of the midterm Tea Party wave. Since then, the man whom some have called a debt warrior has been a major player in the conservative Freedom Caucus and has focused on ways to cut federal spending. He probably should have focused on... Read more →
The online sales tax list for the world's largest online retailer gets longer. Amazon will start collecting state sales taxes on shipments to South Dakota on Feb. 1 and to Wyoming on March 1. If, however, you buy from other online vendors who ship to those states, your bills might not contain a sales tax charge. The deals each state struck with Amazon and announced this week are specific to that company only. Wyoming tax law in the works: While the decision by the Seattle-based online giant to start collecting sales taxes is welcomed by officials in South Dakota and... Read more →
On this Dr. Martin Luther King Jr. federal holiday, the last MLK Day that Barack Obama will serve as U.S. President, the 44th commander in chief will once again spend part of his afternoon volunteering. President Obama and younger daughter Sasha helped out during an earlier MLK Day at DC Central Kitchen. (Click image to see more at Corporation for National and Community Service.) The national holiday honoring the slain civil rights leader has evolved into a day of service. The Obamas take that role seriously. In the past, the president and his family have volunteered at kitchens that feed... Read more →
It's been 10 years since the Internal Revenue Service Whistleblower Office was created to reward those who turn in tax cheats. It's been a pretty good decade. In particular, notable advances were made last year, according to the Whistleblower Office's fiscal year 2016 annual report. More rewards, less money: The Whistleblower Office awarded more than $61 million to 418 whistleblowers in the last fiscal year. That's a 322 percent increase from fiscal 2015, in which only 99 total awards were paid. The number of whistleblower claims filed last fiscal year also was up 6.4 percent from those submitted the prior... Read more →
Millions of taxpayers prepare their own returns using tax software. Even the Internal Revenue Service encourages this do-it-yourself approach with Free File. So it's no surprise that many tax professionals are looking at ways to retain and add to their client base. Unfortunately, crooks know this, too, and are taking advantage with a new phishing scam in which they target accounting and tax preparation firms and pose as potential clients. Instead of looking for help in completing their returns, the cybercrooks are trying to gather sensitive information from tax professionals that the criminals then will use to file fraudulent tax... Read more →
The early part of any new year demands we be tax multitaskers. As we're getting ready to file last year's returns, we also must start planning moves that affect this year's taxes. For the next few days, though, it's time for those of us who pay estimated taxes to focus on 2016. We have to make our final 1040-ES payment to close out that tax year. According to the usual Internal Revenue Service calendar, that final fourth quarter payment is due Jan. 15. But calendar quirks this year mean a change in that deadline. The 15th is on Sunday and... Read more →
Tax filing season 2017 really is here. Some folks have already filed their tax year 2016 federal return (soooo jealous!) even though the Internal Revenue Service won't start processing the submitted forms until Jan. 23. Others of us are still waiting for the tax documents we need to fill out our forms. If you're in the still-waiting group, now's a good time to consider just what you will need to accurately and easily complete your return. To help, here's the 2017 version of the ol' blog's tax filing checklist. It's a good idea at the start of each filing season... Read more →