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Last week, the National Taxpayer Advocate promised that help was on the way for some taxpayers who had missing or incomplete stimulus check payments.

Today, the Advocate delivered, explaining the kinds of problems that the Internal Revenue Service (IRS) will currently resolve, what some individuals need to do to receive a check, and how some taxpayers can claim the correct payment on their 2020 tax return. The Advocate also explained the types of cases the Taxpayer Advocate Service (TAS) is equipped to handle, and how taxpayers can get help.  

National Taxpayer Advocate Erin M. Collins says, about the help, “… we have held continuing discussions with the IRS about these issues, and I am pleased that the IRS has agreed to correct EIP errors in certain categories of cases.”

Here’s how to fix some common stimulus check mistakes:

  1. If you are an individual who used the Non-Filer Tool before May 17 and claimed at least one qualifying child but did not receive the portion of the check attributable to the child, you don’t need to do anything just yet. The IRS is currently issuing those payments. If you have not received a check for the portion attributable to your qualifying child by the end of August, you can call the TAS.
  2. If you are an Injured Spouse with a Form 8379 for the return used to calculate your stimulus check and your portion was withheld, you don’t need to do anything just yet. The IRS is reissuing the Injured Spouse’s share of the stimulus check if it was erroneously withheld. If you have not received a check for the portion attributable to you by the end of August, you can call the TAS.
  3. If you are an Injured Spouse but do not have a Form 8379 for the return used to calculate your stimulus check and your portion was withheld, you need to fax or mail a completed Form 8379 as soon as possible (you can find out more about Injured Spouse here and you can download Form 8379 here). If, after you submit the form, you have not received a check for the portion attributable to you by the end of August, you can call the TAS.
  4. If you returned your stimulus check (or it was stopped or not issued) based on a joint return with a deceased or incarcerated spouse, you don’t need to do anything just yet. The IRS will recalculate the check and will make direct deposits or mail paper checks in the coming weeks. If you have not received a check by mid-September, you can call the TAS.
  5. If the amount of your check was based on a 2018 or 2019 tax return where the IRS identified a Math Error, and the Math Error has been resolved, you don’t need to do anything. The IRS should release the payment automatically.
  6. If the amount of your check was based on a 2018 or 2019 tax return where the IRS identified a Math Error, and the Math Error has not been resolved, you will need to work with the IRS to correct the error before your check can be adjusted and paid. The TAS can also help resolve the error so that you can receive your check.
  7. If you are the victim of identity theft and either did not receive a check or received an incorrect amount, your check can be adjusted as part of resolving the identity theft case. You should contact the IRS to resolve the identity theft issue. The TAS can also help resolve the identity theft issue so that you can receive your check.

Taxpayers who require additional information can call the stimulus check toll-free line at the IRS (1.800.919.9835) for general questions or assistance with a specific issue. If you are eligible for an additional payment, and you’re looking for tracking information, you should be able to track it by using the “Get My Payment” tool on the IRS website (you can read more about the tool here). 

If you are unable to resolve your issues with the IRS and are eligible for direct assistance (generally, you are one of the taxpayers identified in 1-7 above), and you meet TAS criteria, TAS can help. Affected individuals may reach TAS toll-free at 1.877.777.4778.

The TAS shouldn’t be your first stop for help. Typically, the TAS assists taxpayers who are experiencing some financial difficulty, emergency, or hardship, and the IRS needs to move much faster than it usually does (or even can) under its normal procedures; where many different IRS units and steps are involved, and the case needs a “coordinator” or “traffic cop” to make sure everyone does their part; where the taxpayer has tried to resolve a problem through normal IRS channels, but those channels have broken down; or where the taxpayer is presenting unique facts or issues (including legal issues), and the IRS is applying a “one size fits all” approach, isn’t listening to the taxpayer, or doesn’t recognize that it needs new guidance for those circumstances. You can read more about the TAS here.

For other scenarios, including a change in finances or the birth of a child in 2019 or 2020, you must wait until next year to receive additional payments. Some of those scenarios also include:

  1. If you did not file a 2018 or 2019 tax return and you did not receive an information return (SSA 1099 or RRB 1099) or SSI or VA Benefits, you need to use the Non-Filer Tool by October 15, 2020, to receive your check in 2020.
  2. If you did not file a 2018 or 2019 tax return and you did not receive an information return (SSA 1099 or RRB 1099) or SSI or VA Benefits, and you do not use the Non-Filer Tool by October 15, 2020, you will be able to claim your stimulus check when you file your 2020 tax return in 2021.
  3. If your stimulus check was based on your originally filed return and you later filed an amended return that increased the check, you can reconcile the difference when you file your 2020 tax return in 2021.
  4. If your stimulus check was calculated on your 2018 tax return and you want it calculated on your 2019 return, you can reconcile the difference when you file your 2020 tax return in 2021.
  5. If your stimulus check was based on an information return (SSA 1099 or RRB 1099) or SSI or VA benefits information provided to IRS, and you later filed a 2019 tax return or used the Non-Filer Tool, which increased your stimulus check amount, you can reconcile the difference when you file your 2020 tax return in 2021.
  6. If you receive SSA/RRB, VA, or SSI benefits and were deemed ineligible for a stimulus check because you were claimed as a dependent on another individual’s 2019 tax return, you can reconcile the difference when you file your 2020 tax return in 2021 (if appropriate).

If you fall into one of those categories (1-6 immediately above), unfortunately, the TAS cannot help you. But, as noted, there are fixes available which typically include reconciling the difference in 2021. You can also call the stimulus check toll-free line at the IRS (1.800.919.9835) for general questions.

The TAS is continuing to urge the IRS to resolve all stimulus check cases this year for those taxpayers still waiting.

For many years, the Internal Revenue Service (IRS) has grown to help serve our community and taxpayers. Today, the Criminal Investigation Agency, also known as CI, has been working hard to better our community by tackling tax fraud and other financial crimes. The hard work and efforts of this agency are sometimes overlooked or unknown. This week, Kelly invites Don Fort, the Chief of Criminal Investigation with the IRS to explore the crucial work and educate listeners on how the CI Agency provides a backbone for us, worldwide.

Learn it All Through the Chief of Criminal Investigation Himself 

As Don Fort states, “Most crimes are financially driven.” When you start to break down crime, the majority of the cases are related to financial matters. This supports the fact that the CI team always has their hands full, and never stumble upon a shortage of cases. Don has been with the IRS for 29 years now, holding roughly nine leadership positions. If anyone can explain the ins and outs of the IRS, it’s Don. In this episode, Don and Kelly touch base on the organization itself, the cases they face, and the future that lies ahead.  

Listen to Kelly and Dodiscuss more about the IRS and its organization, such as: 

  • The History on the Intelligence Unit and Criminal Investigation 
  • Don’s Career path with the IRS and what lead him to Chief  
  • Don’s successes and special stories that shaped his Career 
  • The truths about Special Agents and Jurisdictions  
  • All about the Academy itself 
  • IRS initiating Cases versus being sought out for them 
  • The Importance of Notable and Neighborhood Cases 
  • Don’s most memorable and highlighted achievements with the IRS 
  • The intensity and timeline of cases 
  • CI’s Danger behind the scenes 
  • How the Tax Code impacts the CI Agency 
  • How to become a part of the IRS or CI team 
  • Strong staff and worldwide successes with the Agency 
  • What is next for CI and Don, as he meets retirement   

More About Kelly Phillips Erb: 

Kelly is the creator and host of the new Taxgirl podcast series. Kelly is a practicing tax attorney with considerable experience and knowledge. She works with taxpayers like you every day. One of the things that she does is help folks out of tax jams, and hopefully, keep others from getting into them.  

Links Mentioned: 

Kelly’s Website – Taxgirl  

Don Fort – LinkedIn 

PPP Florida Arrest 

Al Capone IRS Case 

IRS Jobs 

Internal Revenue Services 

Criminal Investigation Agency 

Did you get the wrong amount in your stimulus check? Help may be available sooner than you think.

Initially, the Internal Revenue Service (IRS) advised that individuals who received the wrong payment amount in their Economic Impact Payment (EIP, or stimulus check) had to wait until 2021 for a fix. And for most taxpayers, that’s still the case.

However, in April of this year, the National Taxpayer Advocate Erin M. Collins advised that she was actively encouraging the IRS to find a way to get updated payments, including the correct amount of child benefits to qualifying individuals this year. There has been some progress.

(You can read more about Erin Collins here.)

According to Collins, while the IRS has not agreed to resolve all stimulus check related issues now, it has established procedures for dealing with some specific problems. For now, the IRS has committed to working to help correct missing or incomplete stimulus checks in the following five situations:

  1. Those individuals who normally do not have to file a tax return, registered for a stimulus check using the Non-Filer Tool, and claimed at least one qualifying child but did not receive the child’s portion of their stimulus checks. 
  2. Those individuals who filed Form 8379, Injured Spouse Allocation (or can complete and return the Form 8379) and did not receive their portion of the stimulus checks. Typically, you are an injured spouse if your share of your tax refund as shown on your joint return was, or is expected to be, applied against your spouse’s past-due federal debts (including student loans), state taxes, or child or spousal support payments. Since the CARES Act made it clear that the only reason a stimulus check might be offset was for past-due child support, many spouses had their share of the stimulus checks yanked.
  3. Those individuals whose stimulus check was based on a 2018 or 2019 tax return where the IRS adjusted the return for a math error that negatively impacted the original amount of the stimulus check. Examples include errors involving a qualifying child, Adjusted Gross Income (AGI), and filing status. According to Collins, the IRS can work with the taxpayer to resolve the math error and, if appropriate, issue a payment for the additional stimulus check amount.
  4. Those individuals who were victims of identity theft and, as a result, did not receive a stimulus check or did not receive the correct stimulus amount. The IRS will adjust the stimulus check once the identity theft issue is resolved.
  5. Those individuals who did not receive a stimulus check because they filed a joint return with a deceased or incarcerated spouse and their stimulus payment was not issued, was returned, or was canceled. The IRS will recalculate the stimulus check and issue it only to the non-deceased/non-incarcerated spouse.

For individuals who fall into those categories, the IRS will begin making direct deposits and mailing checks in the upcoming weeks. If you have already received part of your stimulus check and you qualify for an additional payment, that payment generally will be made in the same manner as before. However, if you previously received your stimulus check on a debit card, the reissued stimulus check will be sent via paper check.

Previously, the IRS did not have a process to resolve these cases. That also meant that there was nothing that the Taxpayer Advocate Service could do. However, the TAS will now accept cases for taxpayers whose stimulus check issues fall within one of the categories described above and who otherwise meet TAS criteria. 

The TAS will begin accepting those cases on August 10, 2020. More information will be issued in the coming weeks, including more specifics about whether you might qualify for help in 2020, or if you will need to wait until they file your 2020 tax return in 2021.  

The TAS will also provide additional information about the best way to reach the TAS for assistance. In the meantime, if you have other questions, you can visit the Taxpayer Advocate Service Coronavirus (COVID-19) Tax Updates webpage.

The TAS is in place to protect your rights as a taxpayer and to help you with tax problems you can’t resolve on your own (you can check out the TAS website here).

And one more thing: if you’re looking for information about a second stimulus check, as of today (August 6), there is still no additional stimulus package. However, both Republicans and Democrats have introduced bills that would include another round of $1,200 checks. Keep checking for more information.

To file or not to file?

 That’s the question that has been posed many times over the past week or so with respect to protective claims for refund for 2016 tax returns. Here’s what you need to know.

The Supreme Court of the United States (SCOTUS) is slated to consider California v. Texas this fall. The case will consider three issues:

1. Whether the individual and state plaintiffs in this case have established Article III standing to challenge the minimum coverage provision in Section 5000A(a); 

2. Whether reducing the amount specified in Section 5000A(c) to zero rendered the minimum coverage provision unconstitutional; and

3. If so, whether the minimum coverage provision is severable from the rest of the ACA.

The Patient Protection and Affordable Care Act (ACA) established a mandate that individuals carry minimum essential coverage or make a “[s]hared responsibility payment.” In 2012, a challenge to ACA went to SCOTUS, where it was found to be constitutional. Specifically, the Court determined that Congress had the authority to regulate tax and found that the mandate, as written, could be interpreted as a tax, and therefore it was constitutional. You can read a little background on the Act here.

In 2017, Congress set the ACA penalty at zero (which is different, legally, from eliminating the penalty), but otherwise left the Act intact. But that tweak led to the current filing. Some states, with Texas at the helm, have argued that since the penalty for not buying health insurance is now zero, it’s no longer a tax. If there’s no tax, they posit, then Congress doesn’t have the right to regulate it, and the mandate is unconstitutional. And, further, if you can’t separate the mandate from ACA, the rest of the law must be struck down.

Some other states, led by California, disagree with that take.

Since there were competing positions affecting states, the matter went before SCOTUS. SCOTUS refused to fast-track the decision but did agree to hear it. Briefs have been filed, and oral arguments are expected in 2020.

So, what does all of this have to do with your tax return?

It’s possible that SCOTUS could decide that ACA is unconstitutional. That would affect not only the shared responsibility penalty but also the related ACA-taxes, like the net investment income tax (NIIT) and the Medicare surtax. If that happens, some tax professionals believe that it might create an opportunity to recover ACA taxes paid in previous years. And since 2016 is one of those years, there is a limited window to file a protective claim for refund. Specifically, the protective claim must be filed by Tax Day, which for 2020 is July 15, 2020.

Here’s what the IRS says.

Generally, the taxpayer must file their claim for a credit or refund within 3 years after the date they filed their original return or within 2 years after the date they paid the tax, whichever is later.

 As a result of COVID-19, the due date to file a protective claim for the tax year 2016 individual income tax returns has been postponed until July 15, 2020. To file a protective claim for the tax year 2016, taxpayers make sure their claim is properly addressed, mailed, and postmarked by July 15, 2020.

According to the IRS, a valid protective claim doesn’t have to list a particular dollar amount or demand an immediate refund. However, a valid protective claim must:

  • Be in writing and signed;
  • Include your name, address, SSN or ITIN, and other contact information;
  • Identify and describe the contingencies affecting the claim;
  • Clearly alert the IRS to the essential nature of the claim; and
  • Identify the specific year(s) for which a refund is sought.

You can find out more on the IRS website here.

So, all of this has resulted in many folks wondering whether to file a protective claim. Like you, I don’t have a crystal ball. But here’s my take: it’s a very individual decision. Case-by-case. I don’t think a blanket “file a protective claim” works for everyone. For the ACA taxes to disappear for 2016, there has to a perfect storm of facts. Consider this:

  • First, SCOTUS has to find the mandate unconstitutional.
  • Second, SCOTUS has to rule that the mandate cannot be separated from ACA, making the entire Act unconstitutional.
  • Third, if SCOTUS does find ACA unconstitutional, they have to rule that the taxes were unconstitutional for previous years – including 2016. Keep in mind that in 2016, the mandate still existed. So if a zero penalty means that there’s no tax, and thus no ACA, that doesn’t mean that the same result applies to the previous years when the penalty still existed. 

Even if all of that falls into place, ACA taxes do not affect all taxpayers. For example, the NIIT and Medicare taxes generally apply to individual taxpayers with an adjusted gross income (AGI) of $250,000 or more for married filing jointly or $200,000 for single taxpayers.

The 3.8% NIIT doesn’t apply to all income. It typically includes interest, dividends, capital gains, rental and royalty income, non-qualified annuities, income from “passive activities” in business, and income from businesses involved in the trading of financial instruments or commodities. For NIIT purposes, capital gains include those not only from stocks and real estate but also gold and crypto. (You can read more here.) The tax is 3.8%, so $10,000 of qualifying income would result in a $380 tax.

And the 0.9% Additional Medicare Tax applies to wages, compensation and self-employment income, but it does not apply to income items included in NIIT. So, using the same numbers, $10,000 in wages would result in $90 of surtax.

So, for most taxpayers, even if all of the stars aligned to eliminate the ACA taxes, the numbers involved could be small and, therefore, possibly not worth the time and expense to file a protective claim. However, if all of the stars aligned to eliminate the ACA taxes, and you are (or represent) a taxpayer that would be significantly affected, it could be worth it.

The bottom line? The question of whether to file a protective claim is personal and is fact and circumstance dependent. If you’re not sure how to proceed, I highly recommend talking with your tax professional.

It’s my annual Taxes from A to Z series! If you’re wondering how to figure basis for cryptocurrency or whether you can claim home office expenses during COVID, you won’t want to miss a single letter.

H is for Head of Household.

I know what you’re thinking: Head of Household is an easy one. That’s because we’re so used to seeing it: one of the first pieces of information you share with the Internal Revenue Service (IRS) is your filing status. Your filing status impacts your tax rates, your qualification for certain tax deductions and credits, and more.

You can choose from one of five filing statuses on a federal tax return:

  • Single;
  • Married Filing Jointly;
  • Married Filing Separately;
  • Head of Household; and
  • Qualifying Widow(er) With Dependent Child.

Easy-peasy, right?

Maybe not. One of the things that I have realized this filing season – largely due to the scramble to understand how to qualify for stimulus checks – is that there are many misconceptions about filing status. And Head of Household is at the top of the list.

So, first, the basics. For federal income tax status, marital status is determined by state law as of the last day of the calendar year. If you are married on December 31, you are considered married for the year (married filing jointly or married filing separately). If you’re not married on December 31 because you were never legally married or you were legally separated or divorced according to the laws of your state, you are not married (single, head of household, or qualifying widow(er) with dependent child). It typically doesn’t matter what happens in between.

Most of those filing status options are pretty straightforward. But head of household can be tricky. You can file as head of household IF:

  1. You are unmarried or considered unmarried on the last day of the year; AND
  2. You paid more than half the cost of keeping up a home for the year; AND
  3. qualifying person lived with you in the home for more than half the year (except for temporary absences, such as school). However, if the qualifying person is your dependent parent, he or she doesn’t have to live with you.

To figure that you, you need some further definitions.

First, you are considered unmarried on the last day of the year if:

  1. You file a separate tax return; AND
  2. You paid more than half the cost of keeping up your home for the tax year; AND
  3. Your spouse didn’t live in your home during the last six months of the tax year (your spouse is considered to have lived in your home even if he or she is temporarily absent due to special circumstances like illness, school or military service); AND
  4. Your home was the main home of your child, stepchild, or foster child for more than half the year; AND
  5. You must be able to claim that child as a dependent (unless you qualify for an exception). 

And, a qualifying person is:

  1. A qualifying child (such as a son, daughter, or grandchild who lived with you more than half the year and meets certain other tests) who is either single or is married, but you can claim as a dependent; or
  2. A qualifying relative who is your father or mother who you can claim as a dependent; or
  3. A qualifying relative other than your father or mother (such as a grandparent, brother, or sister who meets certain tests) who lived with you more than half the year, and you can claim as a dependent. This may include your child, stepchild, grandchild or other descendant of one of your children (or stepchildren or foster children), son-in-law, daughter-in-law, brother, sister, half brother, half-sister, stepbrother, stepsister, brother-in-law, sister-in-law, parent, stepfather, stepmother, father-in-law, mother-in-law, grandparent, great-grandparent, and, if related by blood, aunt, uncle, niece, or nephew.

For purposes of a qualifying person, the IRS even drew up a table for you. It’s the infamous Table 4 that you’ll see referenced over and over in head of household conversations:

You can view Table 4 in full-size by checking out IRS Pub 501, Dependents, Standard Deduction, and Filing
Information
(downloads as a PDF).

But here’s the bit that you need to take away. According to Pub 501, “Any person not described in Table 4 isn’t a qualifying person.”

That seems pretty simple, but many family situations are not terribly simple. So let’s run through some examples that folks are often confused about.

First, spouses. Your spouse is not your dependent. And you must have a qualifying dependent to file as head of household status. So, if you are married without any other dependents, you may not claim head of household status (you would typically opt for married filing jointly). And if you are married but not considered unmarried (yes, I see those double negatives), you typically cannot claim head of household status even if you support other relatives.

What about your significant other? Your significant other may, under some circumstances, qualify as your dependent. However, your significant other is not a qualifying person under the head of household rules because he or she is not related to you.

What about your significant other’s child? Same result. You may be able to claim the child as a dependent, but the child is not a qualifying person for purposes of head of household status because the child is not actually related to you.

What about your own child if you live with your significant other? Finally, a yes. You can file as head of household if you have a qualifying child (or other qualifying person) who lives with you and your significant other so long as the child meets the other criteria.

After re-reading many of your emails, I think the confusion boils down to this one thing: a dependent is not always a qualifying person for purposes of head of household. You have to run through all of the tests.

I know that some of you may have your finger on the email button, ready to send me emails to the contrary. That may be because some websites do claim that your significant other or significant other’s child is a qualifying person for purposes of head of household. But that’s not correct. The IRS confirms as much in Pub 501 (the link is above at the chart), with the following examples:

Example 3. Your girlfriend lived with you all year. Even though she may be your qualifying relative if the gross income and support tests (explained later) are met, she isn’t your qualifying person for head of household purposes because she isn’t related to you in one of the ways listed under Relatives who don’t have to live with you .

Example 4. The facts are the same as in Example 3 except your girlfriend’s 10-year-old son also lived with you all year. He isn’t your qualifying child and, because he is your girlfriend’s qualifying child, he isn’t your qualifying relative (see Not a Qualifying Child Test , later). As a result, he isn’t your qualifying person for head of household purposes.

It’s confusing – so much so that the IRS requires preparers to complete a form confirming that they’ve performed due diligence for head of household filing status. It’s Form 8867, Paid Preparer’s Due Diligence Checklist (downloads as a PDF). The penalty per failure to be diligent is $530 for returns or claims for refund filed in 2020.

 If you’re still not sure whether you qualify as head of household, you may want to try the IRS’ interactive filing status tool. You can find it here.

You can find the rest of the series here:

It’s my annual Taxes from A to Z series! If you’re wondering how to figure basis for cryptocurrency or whether you can claim home office expenses during COVID, you won’t want to miss a single letter.

F is for FTE.

FTE is one of those terms that many folks had never heard of before the Paycheck Protection Program (PPP). But FTE did exist. In the pre-PPP world, FTE (full-time equivalent) means the hours worked by an employer on a full-time basis. And before COVID-19 and Small Business Administration (SBA) loans, FTE was typically a measure of how part-time employees compared to full-time employees for the sake of, among other things, determining payroll efficiency.

The PPP uses FTEs as a metric to compute loan forgiveness. Specifically, one of the loan forgiveness conditions is proving that you maintained the same number of FTEs during the 24-week PPP period as you did before COVID-19. The actual number of employees may not be the same as it was pre-COVID-19 (due to turnover, different levels of hiring, etc.), but the FTE needs to remain the same.

Treasury defines an FTE as an employee who works at least 40 hours per week. So, 40 is your benchmark with some exceptions:

  • Overtime doesn’t count: if you work 80 hours per week, you don’t count as two FTE. You’re still just one FTE.
  • Part-time hours do count, however. To figure your FTE for part-time workers, add up their average hours, and divide by 40. So, if you have five employees who each work 12 hours per week, that’s 60 hours. Those folks don’t count as five employees: they count as 1.5 FTE (60/40=1.5). 
  • To get your overall FTE, you would add your full-time FTE (that’s typically the easy part) to your part-time FTE.

Here’s a quick example: 

 Let’s say that you have four employees who work 40 hours or more, and the same five part-time employees as above. For PPP purposes, you don’t have nine employees: you have 5.5 FTE (four full-time FTE + 1.5 part-time FTE).

Got it?

If that math is too complicated, you can use fixed numbers of 1.0 for full-time employees and .5 for everyone else. However, if you opt for the simple version, you have to use it consistently throughout PPP (no mixing calculations).

If you reduce salaries or wages, but not hours, you may still have to reduce FTE. The quick and dirty rule is this: calculate the average annual salary or hourly wages during the covered period and divide it by the average annual salary or hourly wages of the look-back period. If that number is more than .75, there is no salary or hourly wage reduction. If it’s less, then you may need to reduce FTE (or see if you qualify for a safe harbor).

Why does all of this matter? It goes back to PPP loan forgiveness. If you reduce the number of FTEs during the covered period, your loan forgiveness piece will be reduced proportionately.

There are some exceptions to the reduction, as you’ve no doubt heard. Most notably, if you offer to rehire an employee (in writing) and the employee was fired for cause, turned your offer down completely, or asked for a reduction in hours, you may be able to exclude them in your calculations. As with all tax and financial matters, keep excellent records to support these positions.

There are also some safe harbors. If you weren’t allowed to operate because of COVID-19 related restrictions or if you were able to restore your FTE to pre-COVID levels by the end of the year, you may still qualify for forgiveness.

Since this part of my A to Z series, this post is meant to be a quick primer. It’s not intended to be exhaustive. Entire articles have been written on the calculations alone (not to mention the safe harbors), and that doesn’t even include the numerous changes and clarifications from Treasury… You get the point. If you have specific questions, be sure to check with your tax professional.

You can find the rest of the series here:


The Internal Revenue Service (IRS) has announced that it will begin opening its Taxpayer Assistance Centers (TACs) to the public in phases beginning today, Monday, June 29, 2020.

Those taxpayers seeking in-person assistance at a TAC will need to make an appointment. To do so, you. must call 1.844.545.5640.

Appointments will be available if people need assistance for authentication of identity and document validation related to tax return filing or application for an Individual Taxpayer Identification Number (ITIN); Sailing Clearances required for foreign travel by resident and non-resident aliens leaving the United States; assistance with Economic Impact Payment Issues; and cash payments. 

For an up-to-date listing of TAC locations as they open, click over to Contact Your Local IRS Office.

If you have questions that you hope to have answered over the phone, keep in mind that IRS live phone assistance remains limited. For Economic Impact Payment (EIP, or stimulus questions), call 800.919.9835 (that’s an automated number followed by a live person).

For other issues, please visit Let Us Help You on the IRS web site to find the phone number for the office best equipped to address your specific concerns.

Will he or won’t he?

That’s the question on the minds of taxpayers and tax professionals alike as Treasury Secretary Steven Mnuchin continues to mull extending the tax filing deadline for 2020. As it currently stands, the 2019 tax filing deadline remains July 15, 2020.

Last year, the Internal Revenue Service (IRS) received and processed nearly 156 million returns. About 137 million were received before the filing deadline. The remainder – about 10% – were filed with an extension. That’s in keeping with the usual expectations for extended returns.

Despite the extraordinary circumstances surrounding this tax season, the IRS has already received nearly 137 million returns in 2020 – but that number on its own is a bit misleading. That number includes tax returns that were filed to obtain Economic Impact Payments (EIPs, or stimulus checks) by those who would not usually file. Still, numbers in previous weeks have tracked at a higher rate than expected, and a few million more taxpayers could likely file before the July 15, 2020, deadline, bringing us level(ish) with 2019.

Mnuchin noted as much on Tuesday, telling those watching the Bloomberg Invest Global forum that most Americans have already filed their returns, nearly a month ahead of the deadline.

“I’m pleased to report that returns filed are only down 10 percent year-over-year, and refunds are down only 10 percent,” Mnuchin said. “The majority of those people that needed to get refunds got them.

As a result, the IRS has not made plans to extend the July 15 filing deadline. However, Mnuchin hasn’t ruled out the possibility, saying, “It’s something I’m thinking about.” He said that he would continue to consider the idea as the date approaches.

Many tax professionals wish that the decision would happen a lot more quickly. Offices in some states – like Pennsylvania – are just now re-opening, while others remain shut as the coronavirus numbers continue to climb. Some taxpayers have not been able to meet with preparers and will likely require extensions if the filing date is not extended. 

Additionally, other taxpayers could not get to the IRS’s Volunteer Income Tax Assistance (VITA) and Tax Counseling for the Elderly (TCE) programs before the pandemic. The VITA program offers free tax help to people who generally make $56,000 or less, persons with disabilities, and limited English-speaking taxpayers who need help preparing their own tax returns. The TCE program offers free tax assistance for those 60 years of age and older.

Those VITA and TCE offices closed in spring. The website now advises that those programs are closed indefinitely.

That means that low-income taxpayers and seniors may not have access to free tax preparation at all. In the current climate, those same taxpayers may also not be prepared to pay for tax preparation even if they could find an available tax preparer: many tax preparers that I’ve spoken with this tax season declare that they are busier now more than ever.

But those busy tax preparers aren’t all on board for extending the season, noting that it will simply make an already long tax season longer. And, extending the season to October could mean that the lead-in to the 2021 tax season becomes even more difficult.

There’s no perfect decision, but one thing is sure: taxpayers and tax professionals would rather know the outcome sooner than later. Stay tuned.

Taxpayer asks:

My stimulus check is wrong. How can I fix it? I tried calling the IRS but couldn’t get anyone on the phone.

Taxgirl says:

The short answer is that you can’t immediately fix it. Even if you could get someone on the phone, the advice will be the same: you’ll have to wait. Specifically, the Internal Revenue Service (IRS) says on its website, “The IRS is not able to correct or issue additional payments at this time.”


There is some good news. You can fix it eventually. You will be able to claim the additional amount – either the missing $500 for a child or an adjustment because of your income – when you file your 2020 tax return in 2021. You’ll want to hang on to Notice 1444, Your Economic Impact Payment (you should receive it about two weeks after you receive your check) so that you’ll know how much to claim when it comes time to file.

(And yes, there has been some chatter about a fall fix, but so far, that’s not in the cards.)

Before you go: be sure to read my disclaimer. Remember, I’m a lawyer and we love disclaimers.
If you have a question, here’s how to Ask The Taxgirl.

Lost your stimulus card? Tossed it in the trash?

I reported earlier that some taxpayers were mistaking their Economic Impact Payments, sometimes called stimulus checks, for trash – tossing cards and checks away.

Last week, the Internal Revenue Service (IRS) issued a reminder to taxpayers that some Economic Impact Payments, sometimes called stimulus checks, were being sent by prepaid debit card. Nearly 4 million people are being sent their Economic Impact Payment by prepaid debit card, instead of a paper check. The debit card will arrive in a plain envelope from “Money Network Cardholder Services.” The Visa V -2.3% name will appear on the front of the card; the back of the card has the name of the issuing bank, MetaBank®, N.A. The information included in the envelope will explain that the card is your Economic Impact Payment Card.

Paper checks will be sent in a marked envelope from the U.S. Treasury.

As of the date of my first story (May 27, 2020), the cost for a replacement card was listed on the fee schedule as $7.50 ($17 additional charge for priority shipment).

However, after the IRS announcement – and my story – the EIP prepaid debit website (eipcard.com) was quietly updated. As of May 29, 2020, the website states that the fee is “$0.00 for first reissued Card.” According to the new information:

If your Card is discarded or destroyed, it is important that you call Customer Service at 1.800.240.8100 (TTY: 1.800.241.9100) immediately and select the “Lost/Stolen” option.

Your Card will be deactivated to prevent anyone from using it and a new replacement Card will be ordered. Your first reissued Card will be free1 and then a $7.50 fee will be applied for each additional reissued Card. Please refer to the material in your Welcome Packet or see your Cardholder Agreement online at EIPCard.com for more information.

Neither MetaBank nor Treasury made much ado of the change. It might have gone unnoticed on my end, too, if Phyllis Jo Kubey, EA, had not pointed out the zero-fee. I checked the website and saw that the FAQs had been updated at several places to reflect the same change.

It’s a good reminder that things are changing at the speed of light these days. Keep checking in for the latest.