IRS Announces Penalty Relief for Some 2019-2020 Returns

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This week the IRS announced that it was abating certain penalties relating to the 2019 and 2020 tax periods. Taxpayers who have already paid these penalties could be seeing a refund check in the mail. What Penalties Will be Abated? The following penalties for tax periods 2019 and 2020 if filed before September 30, 2022 … Read more

Why Haven’t I Received My Refund?

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If you paper filed a return and are owed a refund, you may be wondering why it is taking so long. The reason is likely that your return is caught up in a backlog of paper-filed returns. 1 Take a Deep Breath2 Always E-file Whenever Possible3 Check the Status of Your Refund Online4 How Long … Read more

Tax Court Clarifies Requirements for Charitable Contributions

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Taxpayers may deduct charitable contributions if they meet specific requirements. In Albrecht v. Commissioner; No. 13314-20; T.C. Memo. 2022-53, the Tax Court clarifies these requirements. Law Regarding Charitable Contributions Over $250 IRC § 170(a)(1) allows deductions for charitable contributions. For a contribution over $250, IRC § 170(f)(8) requires a contemporaneous written acknowledgement (CWA) from the donee … Read more

Tax Court Says Voluntary Payments to Spouse not Deductible as Alimony

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Amounts paid to a spouse or former spouse under a divorce or separation agreement may be deductible as alimony or separate maintenance payments. There are certain requirements to be met for such payments to be deductible and the Tax Court fleshes those out in the recent Ibrahim v. Commissioner; No. 10750-20S; T.C. Summ. Op. 2022-7. … Read more

Tax Court Finds Taxpayers Were Not Real Estate Professionals

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In general real estate activity is considered a passive activity which means that any loss is not deductible in the current year and must be carried forward. There are two exceptions to this rule: 1. Taxpayers can deduct up to a $25,000 special loss allowance if they actively participated the the rental activity and their … Read more

What to Do If You Don’t Get a W-2 from Your Employer

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It’s tax time and if you’re missing your Form W-2, here are some things you can try. 0.1 Contact your employer first0.2 Contact the IRS1 What if I need a previous year W-2 or I lost my Form W-2?1.1 Contact your employer1.2 Contact the Social Security Administration1.3 Get a wage and income transcript from the … Read more

How Advance Child Tax Credit Payments Might Impact your Tax Refund in 2022

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Child tax credits are typically claimed when taxpayers file their income tax returns. However, as part of the American Rescue Plan package, millions of parents received monthly advances of their child tax credits from July through December of 2021. In addition, the total child tax credit amount and eligibility were expanded. The IRS calculated the … Read more

IRS Suspends Some Tax Due and Unfiled Return Notices Due to Backlog

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Have you received a letter from the IRS stating that you owe taxes even though you paid it? Or that you have an unfiled return even though you’ve filed it? You’re not alone. The IRS says it is aware of the problem and is assisting taxpayers by suspending certain automated notices. The IRS is entering … Read more

IRS Issues Refunds for Taxes Paid on Unemployment Compensation

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The IRS recently issued 430,000 refunds totaling more than $510 million to taxpayers who paid taxes on unemployment compensation excluded from income for tax year 2020. 1 Is unemployment income excluded from tax?2 How many taxpayers are impacted?3 How will you be notified? Is unemployment income excluded from tax? Per the American Rescue Plan, up … Read more

How to Verify your Identity with IRS and Get your Refund in 3 Steps

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You may have received a letter from the IRS asking you to verify your identity after filing a tax return. These letters are sent by the IRS to prevent identity thieves from getting your refund. 1 When do you need to verify your identity?2 First, gather your supporting documents3 Second, verify your identification3.1 Online ID … Read more