Five IRS Tips for Filing Your Taxes

The January 31st deadline for receiving your tax documents has just passed, and you are ready to file your taxes; however, the news is full of stories about the IRS and the delays in processing returns this year. The IRS has cited the Coronavirus pandemic and the backlog of 2020 tax returns for the delays. This year, it is more important than ever to ensure you use extra caution when filing your tax returns to avoid processing delays.

Five Tips from the IRS for Filing Your Taxes

1. Document Collection- It is essential to collect all documents showing a taxable income. Missing documents will cause delays in processing. You should have your IRS W-2 forms, Form 1099, and any other statements that show you have received a taxable income. For anyone who received an advanced Child Tax Credit (CTC), you should receive IRS Letter 6419 showing the amount of your CTC payment. If you did not receive an advance CTS payment, you can claim full credit. If you received a third Economic Impact Payment (EIP), you should receive IRS Letter 6475. If you have not received full EIP amounts, discuss with your CPA or tax advisor if you qualify for a Recovery Rebate Credit (RRC).
2. File an Accurate Return- The IRS encourages filing electronically and selecting direct deposit for your refund. Filing your return electronically will reduce the number of errors that can occur versus manual filing. 
3. Use Online Resources- Use irs.gov online tools and resources. You can find answers to many tax questions, check the status of your refund and pay your taxes online. The IRS also provides updates and tips on their social media accounts and IRS YouTube videos. If you prefer to call the IRS directly, expect a very long wait time.
4. Delayed 2020 Tax Returns- If you are still waiting to have your 2020 tax return processed, you can still file your 2021 tax return. To e-file your 2021 return, you should enter $0 for last year's adjusted gross income (AGI). If you used the Non–Filer tool in 2021 to request an advance Child Tax Credit or a third Economic Impact Payment, you should enter $1 as your 2020 AGI. All other taxpayers should enter the AGI from their 2020 tax return. If you are using online tax software, the field for the 2020 AGI will usually auto-populate.
5. Use the Free Resources- There are free resources available on irs.gov, including the IRS Free File program open to anyone with an income of $73,000 or less in 2021. Please note this is only free filing for Federal, not your state income tax.

Every tax year, there are changes to the tax law, and this year is no exception. There are updates to tax brackets and deductions and a few temporary COVID tax provisions extended into 2021. Our team is ready to guide you through the tax filing process. Contact us to make your appointment today.