Posts Tagged ‘IRS e-file’

Articles

Tax Returns Errors = Delay in Refunds

In Accounting & Finances,Business,Taxes on June 1, 2014 by Sufen Wang Tagged: , , , , , , , ,

homerMake No Mistake About It: Tax Return Errors Delay Refunds

Tax day has come and gone, and now you just have to wait. And wait and wait and wait and wait a second, what’s taking your refund so long? The delay might be due to a blooper on your tax return – the IRS will need to contact you to correct it. You’re more likely to make a mistake if you file on paper instead of IRS e-file – twenty times more likely in fact.

identity_theft3For example, you might have written in the wrong SSN or even forgot to put it at all. That’s usually the case – we forget the most important thing because we’re so focused on the little details. It’s okay to peek at your SSN card to make sure you got your own number right.

Everybody has crazy spellings of their names nowadays with silent consonants, extra vowels, and missing letters all over the place. Be sure to spell the names of everyone on your tax return exactly as they’re printed on their SSN cards.

help+calculatorFiling status might seem like a guessing game. A lot of folks accidentally file as Head of Household instead of as Single (the former does sound more impressive). Luckily, the Interactive Tax Assistant can give you a helping hand with filing status.

OLYMPUS DIGITAL CAMERASimple arithmetic gets complicated fast when a lot of numbers are involved. If you’re tempted to show that calculator who’s boss and do everything with the old noggin’, don’t. Math mistakes are a common error on tax returns, especially when you don’t have tax preparation software doing the calculations for you.

stop-read-instructionsRead all the instructions. This goes for everything in life, but is especially important when it comes to baking, setting up expensive electronics, and figuring tax credits or deductions. A lot of filers botch up when figuring their EITC, Child and Dependent Care Credit, and the standard deduction.

Choosing direct deposit will get you your refund fastest. However, choosing direct deposit and using the wrong bank and account numbers on your return is a sure way to get your refund slower.

pen_signatureWhew, you made it through the tax return, double-checking your math and ensuring everyone’s names have all the extra letters they’re supposed to have. But all that work will be for nothing if you don’t put your John Hancock on there, along with the date. And go find your spouse if you’re filing jointly – the return isn’t valid unless both of you sign.

You can’t exactly sign with a pen when you’re filing electronically. Well I mean you can try to, but your computer screen won’t look too great afterwards. Instead, use a PIN to sign the return. If you know last year’s e-file PIN, use that. If not, enter the Adjusted Gross Income from your originally-filed 2012 federal tax return, but don’t use the AGI amount from an amended or IRS-corrected 2012 return. 

internet-32340_640To err is human – which is why it’s best to rely on IRS e-file in the future.

Sufen Wang, M.S.Accountancy
www.sufenwang.com
Wang Solutions, Long Beach, CA (562) 856-0793
Editor: Hannah Huff, M.F.A. Creative Writing: Poetry, (626) 806-5805

 

Articles

Determining Your Correct Filing Status

In Accounting & Finances,Business,Culture,Taxes on April 27, 2013 by Sufen Wang Tagged: , , , , , , ,

MH900151049Single, Married, or Head of Household?

Okay, seriously, now that the tax deadline, April 15, had passed, and tax extension had filed; you really need to start working on your returns!

What’s your status? No, not your Facebook status, your income tax return filing status. Filing status can impact the tax benefits you receive, the amount of your standard deduction, and the amount of taxes you pay. It can even – drum roll please – affect whether you have to file a federal income tax return.

MH900019119Classifying your relationship as “It’s Complicated” will only annoy the overworked IRS Agent. You must choose from five filing statuses on a federal tax return, with the three most common being “Single,” “Married Filing Jointly,” and “Head of Household.”

MH900237191Your marital status on the last day of the year is your marital status for the entire year. So even if you had a New Year’s Eve wedding, in tax return terms, you were married for all of 2012. A married couple can either file together using the Married Filing Jointly status, or separately, in which case each person’s filing status would be Married Filing Separately. Pretty self-explanatory.

If your spouse died during 2012, you usually can still file a joint return for that year. Qualifying Widow(er) with Dependent Child status applies only ifyour spouse died during 2010 or 2011, you have a dependent child, and you meet certain other conditions.

MH900237195If you aren’t married, divorced, or legally separated, in general your filing status will be Single. However, you might be able to file as Head of Household, which has a higher standard deduction and lower tax rates than the Single filing status. To claim Head of Household, you can’t be married and you must have paid more than half the cost of maintaining a home for yourself and a qualifying person. Head of Household is the status most often claimed in error, so make sure you meet all of the requirements.

You can and should shop around for the best income tax deal. If more than one filing status fits you, choose the one that allows you to pay the lowest taxes. IRS e-file will help you determine the correct filing status, and you can also use the Interactive Tax Assistant at IRS.gov.

Sufen Wang, M.S. Accountancy

Wang Solutions, Long Beach, CA (562) 856-0793

Editor: Hannah Huff, M.F.A. Creative Writing: Poetry, (626) 806-5805

Articles

Taxes are Due Monday April 15:

In Accounting & Finances,Business,Taxes on April 11, 2013 by Sufen Wang Tagged: , , , , , , ,

169849_taxYour Guide to Hassle-Free Filing

There’s less than a week to go before your taxes are due to Uncle Sam. If you haven’t submitted your return, you can start panicking right about now OR you can follow these easy steps to ensure submitting your return is as painless as possible. And if you’ve already submitted, it doesn’t hurt to keep these strategies in mind for next tax season.

MH900334322First, get together any documents you might need to file your taxes BEFORE you sit down to fill out your return. You don’t want to be running around like a headless chicken looking for this or that piece of paper. Instead, find receipts, cancelled checks, W-2 Forms, Wage and Tax Statements, and 1099 income statements, and place them all in one convenient location for easy reference.

Now that that’s done, figure out how you want to file. If your income was $57,000 or less, take advantage of the Free File service: Free File Tax Software will do all the tax preparation work for you online, and it doesn’t cost a cent. If you’re more of the DIY type, you can also e-file by using Free File Fillable Forms, which are an electronic version of IRS paper forms. In fact, regardless of income, anybody can use these Fillable Forms to file Form 1040 series tax returns for free.

internet-32340_640If you don’t use the Free File service, you can still e-file by buying commercial tax software, or through a paid tax preparer. Many tax preparers are now required by law to use e-file because it gets you your refund in half the time and it offers more payment options when you owe money. Even the IRS claims that “IRS e-file is the best way to file an accurate tax return.” And most people seem to agree, with more than 80% of taxpayers using IRS e-file last year. Of course, if you want to make things difficult, you can still file on paper…

However you decide to file, direct deposit is the fastest and safest way to get your refund. And combining it with e-file will get your money even faster. That being said, faster is not necessarily better when you’re actually filling out your return. Don’t rush and be sure to double-check everything before you submit: a mistake on something as simple as your social security number could get complicated when processing your return.

black-29972_640If you have any questions, the IRS has all the answers. Visit IRS.gov to browse its resources, such as the Interactive Tax Assistant tool, or check out Publication 17, Your Federal Income Tax.

By the way, just in case you are NOT going to make the April tax deadline… Make sure you file a tax extension by April 15!!!!

Sufen Wang, M.S. Accountantcy
Wang Solutions, Long Beach, CA  (562) 856-0793

Articles

Revisiting IRS Budget Cut…

In Accounting & Finances,Business,Taxes on March 18, 2012 by Sufen Wang Tagged: , , , , , , ,

IRS Practitioner Phone Line Wait Time: First Sign of Services Decline?
 
Back in November, the IRS predicted that reducing its budget would mean trouble for taxpayers and practitioners down the road. Well, now we’re down the road and it looks like the IRS was right. (Ref: Blog: IRS Budget Cut)
 
From January 1 to March 1, IRS’s practitioner priority telephone line serviced only 69.9 percent of calls and the average wait time was 26 minutes. IRS Taxpayer Advocate Nina Olson advised callers to “bring your knitting to the phone.” She explained that “There is simply too much work and not enough employees to do the work.” Many practitioners have already noticed an overall increase in tax return processing time and the issuance of tax refunds
 
If problems like this are occurring with only a 0.2% reduction in funding from 2010 to 2011, then just imagine how long the wait time will be when the 2.5% cut in 2012 comes into full effect. On the bright side, at least a lot of sweaters will get knitted.
 
On the Money,
Sufen Wang
Wang Solutions

Articles

Undeliverable Refund from the IRS… Really?!

In Accounting & Finances,Business,Taxes on February 1, 2012 by Sufen Wang Tagged: , , , , , , ,

IRS Seeks to Return Undelivered Refund Checks…

Are you missing your refund?  Don’t miss out on your missing money….

The IRS is doing a little year-end cleaning and they want to get rid of your money. Almost 100,000 taxpayers didn’t receive their tax refunds last year due to simple mailing address errors. That means over $153.3 million, or about $1,547 per check, in refund checks had to be sent back to the IRS offices because of scribbled, incorrect, or just plain missing addresses – and are just waiting to be returned.

So if you’re one of those people still asking “Where’s my refund?”, you might find the “Where’s My Refund?” tool on IRS.gov very useful (or call 1-800-829-1954). You can check the status of that mysteriously absent check and find instructions on how to resolve any delivery problems. These are the only ways to find out about your pending refund, so don’t be fooled by e-mails that look like they are sent by the IRS. Those messages are phishing scams and your computer will be grateful if you don’t open the attachments or click on any suspicious links. 
 
A word of advice on future filings, you really should just choose direct deposit when you file your return and completely avoid the hassle of lost, stolen, and undelivered checks. You can receive the tax refund directly into your bank account, divvy it up between two or three financial accounts, or even buy a savings bond! You might as well go digital all the way and file your tax return electronically, so that you don’t have to go all the way to the post office. The IRS also recommends e-file because it eliminates the risk of lost paper returns, reduces errors on tax returns, and speeds up refunds. This is particularly useful for taxpayers who can’t even read their own handwriting; well, maybe they can, while the IRS Revenue Agent has to guess what those numbers really are on their returns.
 
The IRS knows best when it comes to tax returns, so listen to its recommendation and use e-file and direct deposit to avoid future delivery problems. You can also literally listen to the IRS’ Undeliverable Refund Podcast for more information or check out the agency’s Undeliverable Refund Video.

 
On the Money
Sufen Wang
Wang Solutions
 

Articles

Hello E-File!

In Accounting & Finances,Business,Taxes on January 9, 2012 by Sufen Wang Tagged: , , , , , ,

Good-Bye Paper Returns, The IRS Makes Its Digital Move

 

The IRS is doing everything it can to ensure e-filing remains alive and well.  In 2011, paid preparers who expected to file 100 or more individual income tax returns during the calendar year were required to file electronically. However, the new year means new requirements. As of January 1, 2012, paid preparers who expect to file just 11 or more individual, estate, or trust returns must file electronically.
 
Members of a firm will also have to play by these revamped rules. The e-file requirement applies if the firm’s members in the aggregate expect to file 11 or more covered returns in 2012. Basically, if your firm is doing any business at all, you’re probably going to be e-filing.
 
Indeed, almost every tax return counts when you’re checking for that magic number 11. The regulation covers income tax returns in the Form 1040 and Form 1041 series, and Form 990-T, the Exempt Organization Business Income Tax Return. However, forms such as 1040-NR and 1040X are considered automatic administrative exemptions because they still have to be mailed to the IRS the old-fashioned way, and so you shouldn’t include them in your estimate.
 
Remember that it’s ultimately up to the taxpayer to decide how he wants to submit his tax return.  Psssst, heads-up, keep in mind that most of your client(s) usually do not know what they want; specifically how they want their tax returns to be filed…  So, make sure you give sound advice to your clients in this regards.  However, for those clients who really do not want to go digital, because of the new regulations, you’ll need to acquire a written statement from the taxpayers on or before the date the return is filed. It must be signed and dated (a joint return need only be signed by one spouse) and should state that the taxpayer chooses to file the return in paper format and will be submitting it to the IRS –rather than the preparer. This way, the individual income tax return will not be treated as filed by you, the tax return preparer, and thus will not be included in your return tally.
 
It’s important that you don’t send this statement to the IRS or attach it to your client’s tax return – that’s the taxpayer’s responsibility; well, good luck with that… hoping that your client will do what he is supposed to do…  So, instead, make sure you do your part by attaching Form 8948, Preparer Explanation for Not Filing Electronically, to your client’s paper return and check box 1. You also need to include your PTIN on each tax return where requested. If your client does choose not to e-file, it’s important that he personally mails his return. The IRS is making it clear this year that once a taxpayer chooses not to e-file, it’s hands-off the paperwork for the tax preparer.
 
Hopefully you’re already an authorized e-file provider because that’s the only way you’re allowed to e-file with the IRS. If not, you might want to click on the following link and start applying for your
Electronic Filing Identification Number – it takes at least 45 days for the authorization process. Otherwise you’re going to have a lot of clients filing complaints against their unprepared tax preparer.

 

On the Money,
Sufen Wang
Wang Solutions