All returns containing an Education Credit will be delayed by the IRS until further notice.
The IRS announced on an industry call with software vendors participating in the Controlled Launch this morning that they would start rejecting any e-file that contains Form 8863 (Education Credits) effective immediately. [More]
The IRS will begin processing most individual income tax returns on Jan. 30. Due to last minute changes by Congress, the IRS needed additional time to update forms and schedules and final law requires some changes before the IRS can begin accepting tax returns. [More]
Year after year we have customers come in to Rhodes Murphy offices with questions about filing back taxes. The sooner you address these issues the better and we want to help you. We are now past the filing deadline for ALL 2011 tax returns. If you haven’t filed, chances are you are going to face repercussion from the IRS for your indiscretion. Keeping that in mind, the penalty will continue to get worse the longer that you wait so it is best to clean up your mess before it grows even larger. There are certain situations related to filing later that you must consider. Take a look at the details below.
• Filing late – The Basics
Filing a past due return is the easiest part of the process. You can come in to a Rhodes Murphy office today and start completing back tax returns. Bring all of the information that you have available and we will help you from there. Fill the return out just as you would have before and you are on your way. Keep in mind if you are owed a refund and/or the earned income credit you must file the return within 3 years to receive it…why wait to receive money that is YOURS?!? Also, if you are self-employed you could forfeit the Social security benefits that are due to you if you don’t file. These benefits are calculated based on your filing history.
• Always pay in full
If it is financially reasonable always make an effort to pay the taxes that you owe, along with late filing penalties and interest, in FULL. By doing so you can save yourself the penalties and interest that may result from continuing to put off the payment, the longer you wait, the heftier they get.
• Payment options
Payment options are wide ranging and can help anyone. For starters, you can pay via credit card or debit card. You can also have the funds directly withdrawn from your account. Most IRS offices will even accept cash. In most cases, you can also contact the IRS to set up a payment schedule, it is better to set this up sooner than later and get it over with.
• Sitting tight and the repercussions
Say you choose to sit it out and not file your taxes…you could be in for a world of trouble. For starters, the IRS will continue to assess penalties and interest until the amount due is paid. These can add up quickly and far eclipse the original liability. In many cases, the IRS will calculate your amount due based on a substitute return. This return will be calculated based on information they receive from other sources and in all likelihood will not come out nearly as favorable as a timely filed return due to the lack of exemptions etc. Once the IRS establishes an amount due they can place a levy on your wages or bank account and can even place a lien on your property. Oh yea…they can always toss you in jail.
In summary, don’t wait to file your return, just because things look bad , they can get WAY worse. Come in to Rhodes-Murphy today and get started on filing your past due returns…don’t wait!