Don't Mess With Taxes

Green Dot Corporation, a bank and financial services company that has worked with Walmart, Apple, and the U.S. government, has been assessed a $44 million penalty in connection with years of harmful consumer practices, including some associated with tax refund fees. The Federal Reserve System Board of Governors on July 19 announced the multi-million dollar penalty, and also issued a cease-and-desist order against the company. “Green Dot violated consumer law in its marketing, selling, and servicing of prepaid debit card products, and its offering of tax return preparation payment services,” according to the Federal Reserve statement. Overall, the 18-page order... Read more →

The Internal Revenue Service is holding refunds sought by thousands of filers it suspects inflated those amounts by improperly claiming some tax credits. While the IRS sorts through these questionable claims, those taxpayers aren’t going to see any refund money. Not even that amount unconnected to the questionable credit claims. The dubious claims delaying the refunds involve the Fuel Tax Credit, Sick and Family Leave Credit, and household employment taxes. “Scam artists and social media posts have perpetuated a number of false and misleading claims that have tricked well-meaning taxpayers into believing they’re entitled to big, windfall tax refunds. These... Read more →

Photo by Karolina Grabowska The Internal Revenue Service is about to turn out the lights on the 2020 tax refund party. The chance to get your part of more than $1 billion in unclaimed tax money ends on Friday, May 17. The eligible refund recipients are an estimated 938,800 folks nationwide who didn’t, for a variety of reasons, file a 2020 tax return during the 2021 filing season. Tax law says nonfilers have three years to file and collect their refund money. So why didn’t their deadline come and go on this past April 15? You might recall that three... Read more →

Photo by Ahsanjaya You just got your federal tax refund it was not what you were expecting. In fact, it’s much less than the amount your Form 1040 calculations showed. What the heck happened? There are several reason why a refund amount could be less that amount on your filing. The most common smaller refund situations involve math errors in computing your tax bill, or the claiming of incorrect credits or deductions. In these cases, you should have heard from the Internal Revenue Service via a notice about the discrepancy. But another common reason your tax refund is much smaller... Read more →

Getting a tax refund can feel like it's raining money. (Photo by Eugene Lisyuk) You filed your taxes, and now are awaiting a refund. The Internal Revenue Service's data shows the average it had issued as of April 5 was $3,011. That three grand average is a nice chunk of change. Even a smaller amount is welcome. So, what are you going to do with that money? Everyone's personal, financial, and yes, tax, needs are different. But here are some suggestions for all y'all getting a refund. 1. Open or add to a savings account or emergency fund. I know,... Read more →

Photo by Karolina Grabowska Millions of U.S. taxpayers are concentrating right now on their current tax return filing. But another sizeable group who didn't older returns also have some tax work to do. Almost 940,000 people across the nation have unclaimed refunds for tax year 2020. They missed out on that money because they didn't file a Form 1040 back in May 2021. They still have time to collect their part of the just more than $1 billion in old unclaimed refunds, but it's running out. The Internal Revenue Service says the median old, unclaimed refund amount from three years... Read more →

Crooks know you're anxiously awaiting your tax refund. That's why this filing season they're again impersonating Internal Revenue Service agents. The latest refund scam is an email or text about your tax refund or tax refund e-statement. In both cases, warns the Federal Trade Commission (FTC), the messages are efforts to steal your identity and money. As in previous incarnations, these latest fake IRS messages encourage recipients to click a link, supposedly to "check on your tax refund e-statement," or "fill out a form to get your refund." The FTC provided the image below of one of these fake IRS... Read more →

Tax season 2024 is off to a slow start compared to filings at this time last year. At this early point in the tax season last year, the Internal Revenue Service had received nearly 19 million returns. But by the end of the first week of the 2024 filing season, just around 15.3 million returns had arrived at the IRS. That's a substantial 19.1 percent decrease from 2023's early filings. Still, some 2024 taxpayers are happy. They're recipients of the more than 2.6 million refunds that the IRS issued by Feb. 2. The dollar total of those early refunds was... Read more →

Unsplash+ in collaboration with Ave Calvar You checked out my post on who has to file a tax return (thank you!) and confirmed that you're one of the lucky few who doesn't have to file a Form 1040 this year. But maybe you should. Even if you aren't legally required there are some good reasons to send the Internal Revenue Service a tax return anyway. Here are eight such should-file situations. 1. You are due a refund. Most U.S. workers have income tax amounts taken from their paychecks. Other sources of income also sometimes take some tax amounts off the... Read more →

Fortune cookie tax filing wisdom (Photo by Kay Bell) If the 2024 tax-filing season is anything like previous ones, millions of taxpayers sent their 2023 taxes to the Internal Revenue Service today, the official start of federal return processing. The most obvious and common motive for first-day filing is to get expected refunds. But there are some other reasons you might want to file your taxes early. Here are eight. 1. To beat tax ID thieves to the punch. The IRS and its Security Summit partners have made good progress in recent years in reducing tax identity theft and associated... Read more →

IRS Commissioner Danny Werfel speaking at an EITC Awareness Day event in Baltimore sponsored by the CASH (Creating Assets, Savings and Hope) Campaign of Maryland. (Photo courtesy CASH/IRS via X/Twitter) It's the Friday before the annual tax season kick off on Monday, Jan. 29. That means today is Earned Income Tax Credit (EITC) Awareness Day. For the past 18 years, the Internal Revenue Service and community organizations, state and local government officials, schools, employers, and other groups have spent EITC Day getting the word out on this valuable, but too often overlooked, tax credit. Today, IRS Commissioner Danny Werfel headed... Read more →

The majority of taxpayers get refunds. They also file early each tax season so they can get their money as soon as possible. But some are always disappointed. While the Internal Revenue Service aims for a 21-day turnaround, from the time it gets your return and processes it until the day you have your refund in hand, that's not a rule. To borrow from Capt. Barbossa in the original "Pirates of the Caribbean" movie, it's more of a guideline. The IRS used to issue a chart showing expected refund dates based on when taxpayers filed. Now that document, IRS Publication... Read more →

Photo by Jonathan Cooper on Unsplash Millions of taxpayers are anxiously awaiting the start of tax filing season 2024. They are expecting tax refunds. Most of these filers also know that the quickest way to get their tax cash is to file electronically and have their refunds directly deposited. The Internal Revenue Service says that when you take this digital route, you will, in most cases, get you your refund in 21 days or less. Some taxpayers, however, aren't eligible for this faster refund option. They don't have any financial account into which the IRS can electronically deposit their refunds.... Read more →

Many people who are having cash flow issues opt for advances on their expected tax refunds. (Photo via Unsplash+ in collaboration with Getty Images) The 2024 tax filing season will officially start, if prior year tax calendars hold, in about six weeks. That's when the Internal Revenue Service will start processing 2023 tax year returns. But millions of people will file as soon as they can in January, even if the IRS isn't ready. They'll use tax software or a tax preparer to get their 1040 form out of the way and to the head of the processing line. These... Read more →

Individuals who didn't automatically receive an Economic Impact Payment or claim a Recovery Rebate Credit during the COVID-19 pandemic get a second chance at the money. Economic Impact Payments helped many U.S. families financially during the COVID-19 pandemic. But some eligible filers didn't get the stimulus money directly, and didn't claim it later as a Recovery Rebate Credit when they filed. Now they get another shot at the tax relief. Remember Economic Impact Payments? These funds, also referred to as stimulus payments, were issued during the height of the COVID-19 pandemic. The Internal Revenue Service sent most of the payments... Read more →

The Internal Revenue Service isn't playing games with tax refunds. Next tax-filing season, it's popular Where's My Refund? online tracking tool will get some needed improvements. The main questions millions of taxpayers ask every filing season are related to refunds. How big is it? When will I get it? Where the heck is my refund? That last question led to the Internal Revenue Service's creation of its popular online tracking tool, Where's My Refund? Next filing season, which is just three months away, taxpayers will find several improvements to the refund tracker. Popular, but often frustrating, query tool: Where's My... Read more →

If you're just now getting to work on your extended 2022 tax return, which is due to the Internal Revenue Service by Monday, Oct. 16, don't panic. These tips will help you make the most of the little tax time left. (Image courtesy Taxpayer Advocate Service, which also has some tips for Oct. 16 filers.) It's almost Tax Day for extreme procrastinators. The extension you got for your 2022 return ends on Monday, Oct. 16. Since the tax clock is ticking, let's get right to these eight tips that can help you complete your Form 1040 by the fast approaching,... Read more →

Source: IRS The Earned Income Tax Credit was one of the many tax matters mentioned in the Internal Revenue Service's Sept. 8 announcement that, thanks to Inflation Reduction Act funds, it is revising its enforcement efforts. The tax agency's primary goal, per it's news release, is to restore fairness to the tax system. To do that, IRS personnel will focus more on high-earning taxpayers, both individuals and businesses, that have seen sharp drops in audit rates over the last decade. EITC audit reforms on the way: Change also are planned in how the IRS deals with the millions of taxpayers... Read more →

If you live in Minnesota and a letter with a Montana return address shows up in your U.S. Postal Service box, open it. It could be your special, one-time income tax rebate for the 2021 tax year 2021, which the Minnesota Department of Revenue started distributing in mid-August. The amount could be as much as $1,300 for some Minnesota taxpayers. Paper check confusion: Around 2.1 million North Star State residents are eligible for the tax rebate. Most are getting the money as a direct deposit. However, around 950,000 rebate recipients will get their money as a paper check. The checks... Read more →

Millions of people got special state payments in 2022 to help them cover costs that accrued during the pandemic. Some are getting the state relief in 2023, too, prompting the IRS to clarify the federal tax status of this extra cash. (Unsplash+ in collaboration with Kateryna Hliznitsova) COVID-19 did a number on the U.S. economy, prompting federal and state lawmakers to offer a variety of relief programs. At the state level the most notable government help came via stimulus payments. Those payments helped the recipients cover living expenses. They also raised tax issues, specifically whether federal taxes would be due... Read more →