IRS Tax Tip 2017-52

Seven Reminders for Taxpayers Filing Their 2016 Tax Returns by Oct. 16

Every year, millions of taxpayers ask for an extra six months to file their taxes. These taxpayers should have paid the tax they owed by the April deadline, but those who requested an extension should mark Monday, Oct. 16 as the extension deadline for 2017. While the deadline normally falls on Oct. 15, that date falls on a Sunday this year so the due date is moved to the next business day.

Here are seven reminders for taxpayers who have not yet filed:

Try IRS Free File or e-file. Taxpayers can e-file their tax return for free through IRS Free File. The program is available on IRS.gov through Oct. 16. IRS e-file is easy, safe and the most accurate way to file your taxes.
File by Oct. 16. Taxpayers with extensions should file their tax returns by Oct. 16. If they owe, they should pay as much as possible to reduce interest and penalties. IRS Direct Pay allows individuals to securely pay from their checking or savings accounts. These taxpayers can consider an installment agreement, which allows them to pay over time.
More Time for the Military. Military members and those serving in a combat zone generally get more time to file. If this applies to you, you typically have until at least 180 days after you leave the combat zone to both file returns and pay any taxes due.
More Time in Disaster Areas. People who have an extension and live or work in a disaster area often have more time to file. The disaster relief page on IRS.gov has more information.
Use Direct Deposit. The fastest way for taxpayers to get their refund is to combine direct deposit and e-file.
Use IRS Online Payment Options. Taxpayers who find they still owe taxes can pay them with IRS Direct Pay. It’s the simple, quick and free way to pay from a checking or savings account. For other payment options, taxpayers can click on the “Payments” tab on the IRS.gov home page.
Keep a Copy of Tax Return. Taxpayers should keep a copy of their tax return and all supporting documents for at least three years. Among other things, this will make filing next year’s return easier. When a taxpayer e-files their 2017 return, for example, they will often need the adjusted gross income amount from their 2016 return.

More Information:

IRS YouTube Videos:

Reminders for Extension Filers – English | Spanish | ASL

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October 2, 2017 0

Child and Dependent Care Credit

IRS Tax Tip

If you paid someone to care for your child, spouse, or dependent last year, you may be able to claim the Child and Dependent Care Credit on your federal income tax return. Below are 10 things the IRS wants you to know about claiming a credit for child and dependent care expenses.

The care must have been provided for one or more qualifying persons. A qualifying person is your dependent child age 12 or younger when the care was provided. Additionally, your spouse and certain other individuals who are physically or mentally incapable of self-care may also be qualifying persons. You must identify each qualifying person on your tax return.
The care must have been provided so you – and your spouse if you are married filing jointly – could work or look for work.
You – and your spouse if you file jointly – must have earned income from wages, salaries, tips, other taxable employee compensation or net earnings from self-employment. One spouse may be considered as having earned income if they were a full-time student or were physically or mentally unable to care for themselves.
The payments for care cannot be paid to your spouse, to the parent of your qualifying person, to someone you can claim as your dependent on your return, or to your child who will not be age 19 or older by the end of the year even if he or she is not your dependent. You must identify the care provider(s) on your tax return.
Your filing status must be single, married filing jointly, head of household or qualifying widow(er) with a dependent child.
The qualifying person must have lived with you for more than half of 2010. There are exceptions for the birth or death of a qualifying person, or a child of divorced or separated parents. See Publication 503, Child and Dependent Care Expenses.
The credit can be up to 35 percent of your qualifying expenses, depending upon your adjusted gross income.
For 2016, you may use up to $3,000 of expenses paid in a year for one qualifying individual or $6,000 for two or more qualifying individuals to figure the credit.
The qualifying expenses must be reduced by the amount of any dependent care benefits provided by your employer that you deduct or exclude from your income.
If you pay someone to come to your home and care for your dependent or spouse, you may be a household employer and may have to withhold and pay social security and Medicare tax and pay federal unemployment tax. See Publication 926, Household Employer’s Tax Guide.

For more information on the Child and Dependent Care Credit, see Publication 503, Child and Dependent Care Expenses. You may download these free publications from http://www.irs.gov or order them by calling 800-TAX-FORM (800-829-3676).

September 29, 2017 0

Tax Help Available for Those Who Still Need to File for 2016

WASHINGTON — The Internal Revenue Service wants taxpayers, especially those who received tax-filing extensions, to know they can still get the tax help they need to meet the Oct. 16 extension deadline.

Taxpayers can still file their returns electronically. The IRS strongly urges all taxpayers to choose the speed and convenience of e-filing. This is an ideal option as it is fast, accurate and secure. The IRS verifies the receipt of an e-filed return and, statistically, those who choose to file electronically make fewer mistakes. Of the 145.3 million returns received by the IRS so far this year, approximately 87.5 percent — or 127.2 million — have been e-filed.

Individuals who purchase their own tax software can e-file, and most paid tax preparers are now required to file their clients’ returns electronically.

All taxpayers can use IRS Free File. This program offers two options: Brand-name software, offered by the IRS’s commercial partners to individuals and families with incomes of $64,000 or less; Or online fillable forms, the electronic version of IRS paper forms available for any income level.

The fastest and easiest way to get a refund is to e-file and use direct deposit. More than eight out of ten taxpayers who receive refunds choose the speed and convenience of direct deposit. Individuals can choose to deposit their refunds into as many as three accounts. See Form 8888 for details.

Free face-to-face tax help is still available across the country. The IRS sponsors free tax preparation assistance through the Volunteer Income Tax Assistance (VITA) program and the Tax Counseling for the Elderly (TCE) Program. Both programs provide IRS-certified volunteers to prepare federal and state tax returns electronically for people with low-to-moderate income, seniors, disabled individuals or people who speak English as a second language. More information on available locations, times and what to bring can be found by typing “free tax preparation” in the search box on IRS.gov.

The IRS encourages taxpayers to carefully check their tax return before they file. Individuals may overlook certain credits, deductions or allowable expenses they qualify for such as:

The Earned Income Tax Credit (EITC), a benefit for low- and moderate-income workers and families. The EITC Assistant on IRS.gov can help taxpayers determine if they’re eligible;
The Savers Credit for low- and moderate-income workers who contributed to a retirement plan, such as an IRA or 401(k). Individuals will need Form 8880 to claim the credit; and
The American Opportunity Tax Credit, claimed on Form 8863 and other educational tax benefits for parents and college students.

Other taxpayers, such as members of the military and some other groups serving in a combat zone, are allowed more time to file. Typically, these individuals have until 180 days after they leave the combat zone to both file returns and pay any taxes due.

Also, those taxpayers who have a valid extension and are in or affected by a federal declared disaster area may be allowed more time to file. Currently, taxpayers in parts of Michigan, West Virginia and those impacted by Hurricanes Harvey, Irma and Maria qualify for this relief. See the disaster relief page on IRS.gov for details.

Taxpayers with extensions should file their tax returns by Oct. 16, if they owe, they should pay as much as possible to reduce interest and penalties. IRS Direct Pay allows individuals to securely pay from their checking or savings accounts.

Taxpayers can also pay by debit or credit card. While the IRS does not charge a fee for this service, the payment processer will. Other payment options include the Electronic Federal Tax Payment System (enrollment is required) and Electronic Funds Withdrawal which is available when e-filing. Taxpayers can also pay what they owe using the IRS2Go, mobile app. At IRS.gov/paymentstaxpayers will find information about all IRS payment options.

Individual taxpayers can go to IRS.gov/account and login to view their balance, payment history, pay their taxes and access tax records through Get Transcript.

September 27, 2017 0