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It's no secret that the Tax Cuts and Jobs Act (TCJA) was designed to primarily benefit big businesses. But in order to make those tax cuts more palatable to the rest of the U.S. taxpaying universe, Congress added what it promised were benefits for Main Street mom-and-pop operations, too. What's that saying about best laid plans? Four months into the new tax law and it looks like small businesses have a couple of issues with the TCJA. First, an analysis by the Joint Committee of Taxation found that the key tax break for smaller operations, the Section 199A pass-through deduction, actually helps bigger businesses more. Much, much more. Second, most small businesses owners don't understand the provisions that apply to them. Wealthy business owners' big benefits: Under the TCJA, businesses that pass through company profits to the individual owner's personal tax return (hence the pass-through name) can claim a tax deduction equal to 20 percent of the income earned by the business. Sounds good, right? But the pass-through deduction has been problematic from the get-go. The Senate's version of quasi-tax reform differed from the House's bill. Finally, the two chambers compromised in mid-December 2017 on the 20 percent business break. On paper, that looked like the way to go. But in reality, things don't appear that positive for smaller companies. A Joint Committee on Taxation (JCT) analysis of the TCJA released in advance of an April 24 Senate Finance Committee hearing on, official title, "Early Impressions of the New Tax Law," doesn't have good news for small businesses. The nonpartisan Congressional committee that runs the numbers for all tax related Capitol Hill measures found that the pass-through deduction would heavily benefit the wealthiest Americans. How heavily? Americans who make more than $1 million a year comprise just 0.3 percent of all tax filers. This fractional group, however, will receive 44.3 percent of the total benefit from the pass-through deduction, according to the JCT report. By 2024, the pass-through deduction will save affected millionaire filers more than $30 billion. To get those numbers a bit closer to amounts more recognizable for most of us, the JCT report means that more than three-quarter of the pass-through benefits would go to those making more than $200,000 annually. Confusing, too: Adding insult to the disproportionate tax break injury, the TCJA requires businesses jump through a lot of tax hoops to claim the pass-through deduction. That could be why a recent National Association for the Self-Employed (NASE) poll found that many small business owners don't understand new tax law. The survey of 389 nationwide NASE members, conducted online in the month leading-up to this April's tax-filing deadline, found that 83 percent don't fully understand the impact that TCJA will have on their businesses. In addition, more than 90 percent thin that the federal government didn't adequately prepare small businesses for the new tax system. Other NASE survey results that the GOP sponsors of the tax bill aren't going to like include:
"It is crystal clear from our survey that an overwhelming number of small business owners and self-employed Americans still don't understand how to make this new tax law work for them," said Keith Hall, NASE president and CEO, in announcing the survey results. "The tax reform package signed into law last year is based on Americans reinvesting savings back into their business operations and helping to spur overall economic growth. Small business owners must first have a full understanding of how this new tax law will impact their bottom line," Hall said. Are you a pass-through business owner? Do you have an idea of how the 20 percent deduction and other TCJA provisions will affect your personal and business taxes? If you don't already work with a paid tax professional, are you considering hiring one this year to help you make sure you make the most of the new business and personal tax laws? You also might find these items of interest:
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High tax season ended on April 18. High tax scam season never ends. The Internal Revenue Service today warned of a twist on an old phone scam. Criminals now are using telephone numbers that mimic IRS Taxpayer Assistance Centers (TACs) to trick taxpayers into paying non-existent tax bills. It's not the first time this has happened. Back in 2015, the IRS warned of a telephone tax scam that employed spoofing, which is, in the criminal vernacular, the faking of a phone number that shows up on Caller ID. Tax identity thieves also have used smishing, the text messaging cousin of phishing. It gets its name from the Short Message Service (SMS) systems used for texting. Still pretending to be from IRS: Now we're seeing crooks pull the spoofing technique from the what-is-old-is-new-again tax scam files. In this latest version of the pervasive IRS impersonator telephone scam, crooks claim to be calling from a local IRS TAC office. If the taxpayer questions the demand for tax payment, the scam artists direct the taxpayer to the IRS.gov to look up the local TAC office telephone number to verify the phone number. The crooks then hang up, wait a short time and call the potential tax victim back. On this second call, the criminals are able to fake, or spoof as it's known in the criminal vernacular, the Caller ID so that it appears the phone call is coming from an IRS TAC office. After the taxpayer has “verified” the call number as that of an IRS assistance office, the fraudsters resume their demands for money. As in prior telephone tax scam incarnations, these TAC-pretenders generally demand payment on a debit card. Spoofing spreads: Tax fraudsters also have been similarly spoofing local sheriff’s offices, state Department of Motor Vehicles, federal agencies and others to convince taxpayers the call is legitimate. In pretending to be these other agencies, the crooks make threats of arrest, license revocations and in some cases deportation. Not IRS SOP: Phone calls from any IRS offices as the way to make first contact with taxpayers is not the federal agency's standard operating procedure. As with all IRS offices, employees at the agency's TAC branches do not make calls to taxpayers to demand payment of overdue tax bills. Again, the IRS typically initiates most contacts through regular mail delivered by the United States Postal Service. There are special, limited circumstances in which the IRS will call or come to a home or business, such as when a taxpayer has an overdue tax bill, to secure a delinquent tax return or a delinquent employment tax payment. Real IRS agents also might visit a taxpayer's business in order to tour the facility as part of an audit or during criminal investigations. Even in these cases through, taxpayers typically will first receive several letters, which the tax agency calls notices, from the IRS in the mail. Tax scam timing: It is usually easier to fool folks during tax season. Human nature means we worry about getting our taxes filed on time and doing that job correctly. Those fears remain high immediately after the April tax-filing deadline passes. But tax scam artists don't limit their criminal activities. They run on a perpetual criminal colck. That's why the IRS and its Security Summit partners in the tax industry and state tax agencies urge us all to remain alert 24/7, 365 days a year. You also might find these items of interest:
// <![CDATA[ // <![CDATA[ // &lt;![CDATA[ // &amp;lt;![CDATA[ // &amp;amp;lt;![CDATA[ // &amp;amp;amp;lt;![CDATA[ // &amp;amp;amp;amp;lt;![CDATA[ // &amp;amp;amp;amp;amp;lt;![CDATA[ // &amp;amp;amp;amp;amp;amp;lt;![CDATA[ // &amp;amp;amp;amp;amp;amp;amp;lt;![CDATA[ // &amp;amp;amp;amp;amp;amp;amp;amp;lt;![CDATA[ (adsbygoogle = window.adsbygoogle || []).push({}); // ]]&amp;amp;amp;amp;amp;amp;amp;amp;gt; // ]]&amp;amp;amp;amp;amp;amp;amp;gt; // ]]&amp;amp;amp;amp;amp;amp;gt; // ]]&amp;amp;amp;amp;amp;gt; // ]]&amp;amp;amp;amp;gt; // ]]&amp;amp;amp;gt; // ]]&amp;amp;gt; // ]]&amp;gt; // ]]&gt; // ]]> // ]]> from http://www.dontmesswithtaxes.com/2018/04/new-tax-phone-scam-spoofs-taxpayer-assistance-numbers.html Through April 13, the Internal Revenue Service had received 118.6 million tax returns. It had issued more than 86 million refunds totaling almost $243.6 billion. The refund numbers are fractionally smaller than in 2017, but they are still big enough to mean the average amount of money that Uncle Sam has sent so far this year to taxpayers is $2,831. That average check or direct deposit amount actually is slightly larger than last year's amount. GOBankingRates recently asked Americans how they planned to spend their tax windfalls. The results were encouraging for money folks who preach fiscal responsibility.
Forty-three percent of the survey respondents said they will put their refunds into savings. Another 36 percent said they will use the money to pay off debt. More carefree uses of tax refunds accounted for just a combined 21 percent of those polled. Refund redux: The 2018 tax refund use responses were similar to those GOBankingRates reported last year and which DailyInfographic used in creating its visual look at tax facts and how folks spend their tax-back cash. The refund section is shown below; click on it for the full infographic. No refunds are good, too: GOBankingRates found that 36 percent of those polled this year didn't expect to receive a tax refund. That, too, is actually a smart money move. You didn't give the U.S. Treasury use of your money as an interest-free loan all year. You did get more of your money in each paycheck. And you didn't have to wait for the IRS to process your filing and send your tax cash. Yes, over-withholding is an easy forced savings account. But again, no interest. And some refunds — those that are due taxpayers who claimed the Earned Income Tax Credit (EITC) or additional child tax credit — by law cannot be issued until mid-February. In reality, though, that usually means these filers don't get their refunds until late February. Planning your refund: That's why the IRS encourages all of us to double check payroll withholding to ensure that it's one Goldilocks' ursine visitors would love. Just right. That's especially important now that the Tax Cuts and Jobs Act has made substantial changes to many tax provisions that affect withholding and our eventual 2018 return filings next year. If you got or are expecting a tax refund, do your plans align with those found in the polls? Have you received it yet? Or are you still waiting? You also might find these items of interest:
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The IRS still has a desk waiting for its new commissioner. (Photo courtesy Cage Design Group)
David Kautter, no doubt, was among the millions of Americans who were glad to see the 2018 high tax season end. Kautter is the acting Internal Revenue Service commissioner and he was on his way to Congressional hearing on how things were going when he got news of his agency's Tax Day computer hardware problems. How much longer will Kautter, who also is assistant Treasury secretary for tax policy, have to deal with all the IRS' operational matters, including the many issues related to implementation of all the confusing Tax Cuts and Jobs Act changes? No one knows because, as Naomi Jagoda writes in today's online issue of The Hill, the Trump Administration is struggling to get its new IRS team in place. Trump taking his time: John Koskinen, the last IRS commissioner, completed his term Nov. 10, 2017. Trump, however, didn't nominate Charles Rettig to replace Koskinen until almost three months later. "It is not unusual for the IRS to have acting commissioners for stretches of time, nor is it unusual for the confirmation process to take several months. But the stakes are particularly high given the importance of the tax law to Trump's presidency and the myriad challenges the agency faces," notes Jagoda in her article. Her look at how the Trump Administration is taking its time in filling critical IRS positions — the post of IRS chief counsel also remains empty — earns this weekend's Sunday Shout Out. Leadership matters: I know IRS administrative matters might seem a bit too much in the tax weeds for the average taxpayer, but as anyone who's had to pick up slack when a coworker left, it's hard to do two jobs (like Kautter now is) well. "You sort of have one person dividing their time between two jobs," said Mark Mazur, director of the Urban-Brookings Tax Policy Center and who had Kautter's Treasury job during the Obama administration. "And they're two full-time jobs.” Mazur's take is shared by other former Treasury officials, including some previous IRS commissioners. "There's more accountability when you have a Senate-confirmed commissioner," said Mark Everson, IRS commissioner from 2003 to 2007, short-lived GOP 2016 presidential primary candidate and now vice chairman of alliantgroup. The last man to permanently helm the agency agrees. "Any organization runs better when it has a leader who's going to be there permanently," Koskinen told Jagoda. And we taxpayers and tax professionals, now focusing more intently on just how the new tax code provisions affect our 2018 tax planning, need all the help we can get from an IRS that's functioning properly from bottom to top. You also might find these items of interest:
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Parsing payments of various taxes: This year, Tax Foundation data shows U.S. taxpayers worked the longest, 44 days, to pay federal, state and local individual income taxes. Payroll taxes took 26 days to pay, followed by sales and excise taxes, which required 15 days. Corporate income taxes accounted for seven days of work, while property taxes demanded 11 days. The remaining six days were spent paying estate and inheritance taxes, customs duties and other taxes, according to Tax Foundation calculations. The bottom line, as it has been in prior year Tax Foundation analyses of American expenditures, is that U.S. residents collectively will spend more on taxes in 2018 than they will on food, clothing and housing combined. Different state tax freedom days: April 19 is the national Tax Freedom Day, but not everyone had reason to celebrate. The varying tax burdens across the country, along with the ways that states collect their levies, mean that state residents will celebrate their more local Tax Freedom Days at different times. Generally, the states where residents have higher incomes and the legislatures have enacted higher tax rates celebrate Tax Freedom Day later. This is obvious in:
Residents of Louisiana and Alaska bear the lowest average tax burden in 2018 and their Tax Freedom Day arrived April 4. Other early state Tax Freedom Day celebrants were residents of Tennessee, Oklahoma and Alabama, which had their special taxes paid day fall on April 5. You also might find these items of interest:
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I was surprised to see today a survey result that 46% of cryptocurrency traders don't plan to report the transactions for income tax purposes (TeamBlind survey - see 4/17/18 article in The Wealth Advisor). There is, of course, no reason for not reporting income. The IRS is well aware that people have virtual currency transactions. It is also an agenda item for the Criminal Investigation Division of the IRS per their 2017 annual report.
To help track crypto transactions, there are a few software tools readily available. A recent entry to this market is CryptoTrader.Tax. Here is information from their recent press release (with permission of the company): "CryptoTrader.Tax released a web-based tool developed with the intention of helping users calculate the capital gains and losses associated with their cryptocurrency investment endeavors. The tool is currently in the ‘beta’ phase of development, and can be accessed from their website at, www.CryptoTrader.Tax. CryptoTrader.Tax aims to provide its users with an easy and accurate tool to use when it comes time to do their taxes. It properly considers the user’s set time zone, trades across all exchanges, and the sale of their uploaded cryptocurrency income. CryptoTrader.Tax uses a safe, streamlined workflow to gather the data needed to accurately calculate gains and losses. Users upload trade data via exported .csv files from supported exchanges or manually using the provided template. They can also upload several types of cryptocurrency income, such as mining, gifts, etc. The tool then generates detailed reports using the uploaded information. User’s can view an IRS 8949-esque form showing gains and losses for each sell of a coin or view a detailed breakdown of each sell with even more information. There are also views for income items and coins still being held at the end of the year. Future updates planned for the tool include: population of IRS forms, automatic trade importing from a wide variety of exchanges, and more." You can find a few others out there as well. What is important is to check these out and use one. What do you think? from http://21stcenturytaxation.blogspot.com/2018/04/tracking-cryptocurrency-transactions.html
If you missed this year's doubly extended tax filing deadline simply because you procrastinated, or actually over-procrastinated, then you're out of luck. If you owe tax for the 2017 tax year, interest and penalties already are piling up. If this is you — no judging here, just some advice — at least get a belated extension request into the Internal Revenue Service ASAP, along with the money you owe, to stop that costly process from getting worse. The first Weekly Tax Tip of 2018 offers some guidance on moves to make if your missed the Tax Day deadline. Other taxpayers, however, weren't worried about this week's filing deadline because they were dealing with some special circumstances. Unfortunately, a couple of these situations are not ones folks typically want to face, such as coping with a natural disaster's fallout or being in the literal line of fire as a member of the military. But at least the IRS isn't piling on by demanding your tax returns. Yet. Even these folks eventually have to file, but they get more time. Here's the scoop for folks in three special cases on what to do and when to do it to fulfill your 2017 tax year filing obligations. 1. Victims of natural disasters This extended tax deadline also provides additional time for affected Californians to make a 2017 IRA contribution, submit estimated tax payments and file payroll and excise tax returns and corporate income tax returns originally due or on extension during the relief period. The April 30 deadline also applies to tax-exempt organizations that are required to file Form 990 series returns that had a deadline falling during this period. On the other side of the country, filers who endured Hurricane Maria, which devastated portions of mainland United States, the U.S. Virgin Islands and the Commonwealth of Puerto Rico, have until June 29 to file your 2017 tax return and pay any taxes due. The June 29 due date also applies to taxpayers who are victims of Tropical Storm Gita in American Samoa. To find out whether you're in the affected major disaster areas and eligible for the extended tax deadlines, check out the IRS' online Around the Nation page, which has the latest state-by-state IRS news, including special disaster relief provisions. 2. Combat zone taxpayers This includes those serving in Iraq, Afghanistan and other combat zones. A complete list of designated combat zone localities can be found in IRS Publication 3, Armed Forces' Tax Guide. Combat zone extensions give affected taxpayers more time for a variety of other tax-related actions, including contributing to an IRA. Various circumstances affect the exact length of the extension available to any given taxpayer. You can find details, including examples illustrating how these extensions are calculated, in the Extensions of Deadlines section of Publication 3. In a related military tax matter, the IRS on April 13 announced that Armed Forces members who served in the Sinai Peninsula of Egypt may qualify for combat zone tax benefits retroactive to June 2015. Among other benefits available under this designation is the exclusion of part or all of combat pay from income for federal income tax purposes. Service members who previously paid tax on this income may be due a refund, which they can claim by filing an amended tax return. 3. Taxpayers outside the United States The deadline for expatriates to file returns and pay any due tax for the prior tax year is June 15. The automatic June 15 deadline also applies to members of the military on duty outside the U.S. and Puerto Rico, who do not qualify for the longer combat zone extension. If any of these out-of-country situations applies, simply attach a statement to your return when you do file by June 15 explaining which one led to your seemingly late filing. This will prevent the IRS from assessing late-filing penalties. However, the IRS notes that while these non-U.S.-based folks are granted more time to file their 1040s, the April due date still applies to any tax they owe. In these cases, interest, currently at the rate of five percent per year and compounded daily, applies to any payment that wasn't made by April 18. If this is you, try to pay as much of your owed 2017 tax bill as soon as possible instead of waiting until the mid-June filing deadline. That will reduce your interest charges. You can find more information about the special tax rules for U.S. taxpayers abroad in IRS Publication 54, Tax Guide for U.S. Citizens and Resident Aliens Abroad. You also might find these items of interest:
// <![CDATA[ // <![CDATA[ // &lt;![CDATA[ // &amp;lt;![CDATA[ // &amp;amp;lt;![CDATA[ // &amp;amp;amp;lt;![CDATA[ // &amp;amp;amp;amp;lt;![CDATA[ // &amp;amp;amp;amp;amp;lt;![CDATA[ // &amp;amp;amp;amp;amp;amp;lt;![CDATA[ // &amp;amp;amp;amp;amp;amp;amp;lt;![CDATA[ // &amp;amp;amp;amp;amp;amp;amp;amp;lt;![CDATA[ (adsbygoogle = window.adsbygoogle || []).push({}); // ]]&amp;amp;amp;amp;amp;amp;amp;amp;gt; // ]]&amp;amp;amp;amp;amp;amp;amp;gt; // ]]&amp;amp;amp;amp;amp;amp;gt; // ]]&amp;amp;amp;amp;amp;gt; // ]]&amp;amp;amp;amp;gt; // ]]&amp;amp;amp;gt; // ]]&amp;amp;gt; // ]]&amp;gt; // ]]&gt; // ]]> // ]]> from http://feedproxy.google.com/~r/DontMessWithTaxes/~3/B1nClsRRW84/3-special-circumstances-give-some-taxpayers-more-filing-time.html The tax deadline may be in the past but we all know there’s still work to do. The good news is that the influx of people who need things last minute is on a downturn and the end of the season is in sight! At this point of the year, we generally encourage tax pros and business owners to keep up the momentum. Don’t just throw your hands in the air and declare it the end. Before you take a break, while tax season is still fresh in your mind, you should do the following:
Once you’ve worked through those tasks to close out the season, we encourage you to do more than just going out for a beer or a nice meal. Make changes to your routine to ensure that you completely decompress from the season so that you can come back refreshed and ready to generate revenue during the off season. Here are 3 easy ways to destress after tax season. Take some time offFor many of us, going on vacation seems like a pretty foreign concept. After all, with how stringent our demanding schedules can be, it seems like the most obvious option would be to forego any break or time-off and grind through. A vacation is a healthy change of pace that will make you more productive in the long-run. After all, that overworked brain of yours truly needs a break. Getting out of town on a trip is ideal but you could also take a staycation at home. Catch up on some much-needed couch therapy or get out there and reacquaint yourself with the city you haven’t seen since January. You could also spend some time catching up with friends and family – who probably haven’t seen you in a while. The overarching goal is to get yourself in a place where you’re completely relaxed and ready to re-approach work with a fresh mind. Embrace a healthier routineAfter you’ve taken some time away, start looking for ways you can adapt to a healthier routine – one that lends more to dealing with stress in your day-to-day. A healthy routine doesn’t necessarily mean going on a strict diet or starting a new exercise routine. It means being mindful about bad habits you may have picked up while trying to get through tax season. While most of us know that diet and exercise can be a great deterrent of stress, the hardest part is implementing these practices on a daily basis. As noted by the ADAA, only 14 percent of people exercise regularly to cope with stress. Coping with stress through exercise doesn’t have to mean hitting the gym or going for a run. Just going for a walk on your lunch break or riding your bike to work can help tremendously. Additionally, be mindful of your intake of high-fat foods and sugar. According to PCRM, high fat foods and sugar add to your stress load. The best way to approach improving diet and exercise is to take it one day at a time. As silly as that sounds, it’s how habits are formed. Make Adjustments to your work routineFinally, make some adjustments to your work routine to avoid burnout. This can include adjusting your hours and changing up your processes to optimize your output. For example, if you’re someone who has a lot of energy in the morning but tends to slow down in the afternoon, scheduling all your appointments and calls for the evening enables you to have an entire chunk of time to be productive. Fine-tuning your routine and evaluating your productivity levels will only help when things get busy again. Keep on keeping on tax pros! We hope you can use these tips to relax, reset, and get back to work.
from https://www.theincometaxschool.com/blog/destress-after-tax-season/ Missouri taxpayers who have federal tax refunds burning holes in their pockets have a tax-saving way to spend that money. Today, Thursday, April 19, is the start of the state's annual Show-Me Green Sales Tax Holiday. Since 2009, this week-long event provides buyers the opportunity to purchase qualifying new Energy Star appliances without paying any state sales tax on the items. That's an immediate savings of 4.225 percent that, during the other 51 weeks of the year, would be added to these appliances' prices. Plus, depending on where you live (or travel to buy), the sales tax savings could be larger. Local jurisdictions can choose to participate in Missouri's annual spring sales tax holiday. Savings vary by location: The map below shows the handful of counties, cities and special taxing jurisdictions that will waive collection of their sales taxes this year.
Click image to see larger PDF version from Missouri Department of Revenue.
For folks who are textual rather than visual, the Missouri Department of Revenue (MDOR) says the cities that are participating in the 2018 Show-Me Green Sales Tax Holiday — that is, city sales tax in these locations will not be collected on qualifying items — are:
Counties, other taxing areas: Counties that will waive their sales taxes on the energy-efficient products this week are Adair, Cass, Clay, Gasconade, Jackson, Macon, Moniteau, Nodaway, Perry, Platte, Ste Genevieve and Washington. And the districts that usually collect special taxes but won't during the 2018 Show-Me Green Sales Tax Holiday are:
The savings could be significant for shoppers in certain areas where a variety of sales taxes that usually are collected are, for this next week, aren't. Eligible purchases: So what can Show-Me shoppers buy tax-free during this week? The Missouri Department of Revenue says the following Energy Star certified appliances qualify:
Still taxable: Some popular household appliances, however, will still be taxed. These are trash compactors, conventional ovens, ranges and stoves. All of these products, according to the Energy Star website, do not receive an energy star rating. Missouri officials say that although its law technically lists the non-certified products in anticipation that they one day may receive the Energy Star rating, sales tax still will be collected on those appliances during the Show-Me Green Sales Tax Holiday. Also, the law allows retailers that sell less than 2 percent of the qualifying merchandise can offer a sales tax refund in lieu of officially participating in the sales tax holiday. Pay attention to price, too: In addition to buying a new appliance that qualifies for the Energy Star tax holiday savings, you also have to keep an eye on the overall price. The sales tax exemption applies to products priced up to $1,500. The exemption applies to each appliance, not your overall shopping bill. So you can buy a super-duper clothes washer for $1,500 and its companion dryer for $1,500 and not owe sales tax on either. The price limit and exclusion of some appliances during Missouri's tax holiday week underscore why it's so important for shoppers to be educated and aware. Make sure you know the sales tax holiday's rules carefully. To help you do just that, MDOR answers consumer questions about the Show-Me Green Sales Tax event at a special FAQ web page. Happy, and tax-saving, shopping. You also might find these items of interest:
// <![CDATA[ // <![CDATA[ // &lt;![CDATA[ // &amp;lt;![CDATA[ // &amp;amp;lt;![CDATA[ // &amp;amp;amp;lt;![CDATA[ // &amp;amp;amp;amp;lt;![CDATA[ // &amp;amp;amp;amp;amp;lt;![CDATA[ // &amp;amp;amp;amp;amp;amp;lt;![CDATA[ // &amp;amp;amp;amp;amp;amp;amp;lt;![CDATA[ // &amp;amp;amp;amp;amp;amp;amp;amp;lt;![CDATA[ (adsbygoogle = window.adsbygoogle || []).push({}); // ]]&amp;amp;amp;amp;amp;amp;amp;amp;gt; // ]]&amp;amp;amp;amp;amp;amp;amp;gt; // ]]&amp;amp;amp;amp;amp;amp;gt; // ]]&amp;amp;amp;amp;amp;gt; // ]]&amp;amp;amp;amp;gt; // ]]&amp;amp;amp;gt; // ]]&amp;amp;gt; // ]]&amp;gt; // ]]&gt; // ]]> // ]]> from http://www.dontmesswithtaxes.com/2018/04/missouri-shoppers-say-show-me-tax-free-items.html The Internal Revenue Service had issues with some of its online systems on Tuesday, April 17, the day that was supposed to be the filing deadline for our 2017 tax returns. Those problems notwithstanding, e-fling and electronically paying any tax that's due today, Wednesday, April 18 — yes, today, the new filing deadline provided by the IRS to make up for its online inconveniences yesterday — is still the best move for many filers. The agency for years has been encouraging, and in some cases forcing, electronic filing and paying of taxes. The reasons are that it's easier (definitely for the IRS, which has to process more than 140 million forms each year) and more accurate than going the old fashioned paper route. Most taxpayers agree. Through the first week of April this year, the IRS reported that 92.3 percent of filers, or almost 96 million, had e-filed their 2017 tax returns. If you want to join them, there's still time. Here are your options. E-filing choices: Tax e-filing actually covers two things, using software to prepare your 1040 and associated schedules and forms and then submitting that tax package electronically. Nowadays you can choose from many different tax preparation software products. Or you can use a tax preparer who is an IRS authorized e-file provider who has selected his/her own tax prep and filing software.
Click image to go to the IRS.gov e-filing overview page for links to other services.
Picking the perfect tax software: If you're a do-it-yourself kind of taxpayer, the tax software options might seem a bit overwhelming. After all, you can use the software's online version or buy a program to download to your computer or take advantage of a partner tax filing offer from your bank or broker or use the IRS' Free File. It's the tax version of option overload when you try to pick a tube of toothpaste at the grocery store! Take a breath. Now check out NerdWallet's Guide to Choosing Tax Software, as well as my piece on getting the most from your tax software. Transition tasks: If you're new to tax software, converting from your paper filing will take some work. You typically have to enter a lot of the info from the printed forms into your software. In some cases, the software is able to locate your data if your employer and other payers, such as investment companies, have partnered with the tax program manufacturers. The good news, though, is that once that's data entry is done, the next year your software will find the prior filing's data and enter whatever is the same into your new e-forms. That way if your taxes are substantially similar, you're ready to go more quickly. But I digress. Or is it progress, since I was talking about 2018 tax filing due in 2019? Either way, back to this year's e-filing. Free File choices: The IRS doesn't endorse any particular tax software, but you can get a look at those who meet its filing standards by checking out the companies that are participating in Free File. Most also offer paid versions of their Free File software if you don't qualify to use the no-cost online option. If you are, however, eligible for Free File — that's folks, regardless of filing status, whose adjusted gross income is $66,000 or less — consider using it. Or some other free option, either through the software companies or, as mentioned earlier, via a special deal with your bank or other financial account. Taxes are pain enough. If you can do them without shelling out more of your hard-earned (and taxable) money, then great. E-filing details: With tax software, as with old-school paper filing, you still have to sign your tax return (that means both spouses if you're filing jointly). You do so in e-filing by using a Self-Select PIN or by entering your prior-year adjusted gross income. Generally, the tax software will automatically enter the information for returning customers. If you're new to the process, you may have to enter the information yourself. As for the actual submission of your return to the IRS, most software companies offer at least one free federal e-filing. State return e-file options: State taxes, however, tend to be a different, and more expensive, deal. If state returns are important to you, and they are for folks in 43 states and the District of Columbia, then you need to check your software for that option. Most states, though, offer their own version of Free File for residents. Since I live in Texas and don't have to worry about filing state returns, I'm not sure how easy these options or if you have to re-enter a lot of stuff that you put into your federal tax software program. But a check with your state tax department should provide you the details. And again, free! So a little extra data entry is probably worth it. Electronic refunds, too: Finally, if your e-filed federal tax return produces a refund, the IRS suggests you have that money directly deposited into your bank account. It's much quicker than asking for a paper check to be snail mailed to you. Or, if you must also pay estimated taxes on Tax Day and three other times a year, you can have all or some of your refund credited toward your those 2018 payments. E-payment options: OK, let's get real. Most of us who file as late in the tax season as possible do so because we owe Uncle Sam. That's a bummer, but at least we can pay electronically, too. Taxpayers who owe taxes can now choose among several quick and easy electronic payment options, including the following:
Electronically ask for more time: Just can't make the April 18 deadline? Then ask electronically ask for an extension to file. You can do so by filing Form 4868 via your software, your tax preparer or Free File, including Free File Fillable Forms. You also can get an extension without filing Form 4868. Simply use Direct Pay, EFTPS or a credit or debit card (see details above) to e-pay all or part of any tax you've guestimated you owe and indicate that the payment is for an extension. Although you don’t have to file a separate extension form if you use this e-pay option, you will receive a confirmation number of filing for an extension for your records. And remember, as the discussion about e-paying indicates, an extension is just extra time to fill out and submit your forms. It's not an extension to pay any tax you may owe. Not paying will cost you more in late-payment penalties and interst. More tax questions on this last (we hope) day of the 2018 tax-filing season? Check out the Daily Tax Tips. You also might find these items of interest:
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