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IRS news/announcements

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I hate standardized tests. My daughter, a straight-A student at her elementary school, was freaking out over taking the PSSAs, the state-issued assessment tests in Pennsylvania, this week. She was a bundle of nervous energy, talking through a litany of “what if?” questions, all of which appeared to revolve around some kind of worst-case scenario. I suspect she will be on pins and needles until the results are announced.

The waiting game for test results is often stressful. Fortunately, for many tax preparers, the waiting game for the new return preparer competency test is coming to an end: the IRS has begun providing test results to those who have taken the test. Preparers who score at least 350 on the 120 question test (a perfect score is 500) will receive a passing grade. Those preparers who pass and have successfully completed a tax compliance check will be given the designation of Registered Tax Return Preparer.

For now, test results are being sent to tax preparers by letter. However, after April 16, 2012, results will be made available to preparers at the testing site immediately after testing is complete.

The test is part of the IRS effort to regulate preparers. Preparers have nearly two years to take the test. In addition, all paid tax return preparers must have a Preparer Tax Identification Number (PTIN) and pay an annual fee. Certain return preparers must also complete 15 hours of continuing education annually. Certified Public Accountants, attorneys (hooray!), and Enrolled Agents are exempt from the new continuing education and testing requirements. Also exempt are non-signing preparers supervised by CPAs, attorneys, or Enrolled Agents and those who do not prepare the federal form 1040 series.

You can schedule the test online at IRS.gov/ptin. Be prepared: it’s not cheap ($116). That fee is in addition to the annual PTIN registration fee and any fees for continuing education.

It’s tough out there these days and increasingly, taxpayers are scurrying away from their tax obligations for fear that they won’t be able to pay. As a practitioner, I’ve seen the drill plenty of time: lay low and hope the IRS doesn’t come looking for you.

That rarely works. And when IRS does catch up to you, it tends to be much worse. You usually want to come to them before they come to you.

With that in mind, the IRS has announced a major expansion of its “Fresh Start” initiative in order to help struggling taxpayers. IRS Commissioner Doug Shulman said, about the program:

We have an obligation to work with taxpayers who are struggling to make ends meet. This new approach makes sense for taxpayers and for the nation’s tax system, and it’s part of a wider effort we have underway to help struggling taxpayers.

Here’s what the IRS has to offer struggling taxpayers:

1, Penalty Relief. The IRS has announced penalty relief for the unemployed on failure-to-pay penalties. Under the new rules, a six-month grace period on failure-to-pay penalties will be made available to taxpayers; interest on unpaid taxes will continue to accrue during this time. The grace period is available for the tax year 2011 only and limited to balances that are $50,000 and under. The tax, interest and any other penalties must be fully paid by October 15, 2012.

Taxpayers who qualify for the relief are those wage earners who have been unemployed at least 30 consecutive days during 2011 or through April 17, 2012, and self-employed individuals who experienced a dip in business income of at least 25% due to the economy. There are also income limitations: $200,000 for taxpayers filing married filing jointly or $100,000 for taxpayers filing single or head of household.

To apply for relief, taxpayers meeting the eligibility criteria will need to complete a new federal form 1127A (downloads as a pdf).

2, Streamlined Collections. The IRS has also announced that the threshold for using an installment agreement without having to supply the IRS with a financial statement has been raised from $25,000 to $50,000. This means that taxpayers who owe up to $50,000 in back taxes, including penalty and interest, can enter into a streamlined agreement with the IRS to pay the balance over time. The amount of time to pay has also been extended to 72 months (up from 60 months). Penalties may be reduced but interest will continue to accrue while the balance is outstanding.

To take advantage of the new threshold, taxpayers need to file a Collection Information Statement, federal form 433-A or federal form 433-F (each will download as a pdf).

If you have questions about eligibility, you’ll want to contact your tax pro or call the IRS at 1.800.829.1040. Hopefully, these small steps from IRS will help some taxpayers get back on their feet.

The IRS has extra cash: more than $1 billion in extra cash. And some of it might belong to you.

More than one million taxpayers who were due a refund failed to file a federal income tax return in 2008, resulting in more than $1 billion sitting and waiting to be collected. The IRS estimates that half of those refunds are worth more than $600 each.

How much is a billion dollars? I know we throw around these “illions” anymore (millions, billions, trillions) like they’re nothing but it’s a lot of money. How much? If the IRS gave away a dollar an hour, it would take them more than 114,155 years to get rid of $1 billion. Yeah.

Who is owed the most money? By the numbers, the IRS estimates that more folks in California (122,500) are owed refunds than taxpayers in any other state; the state with the least number of taxpayers owed a refund is Vermont (1,700). Taxpayers in Oregon are due the least average refund ($527) while taxpayers in Wyoming are owed the largest average refund ($773).

If you are due a refund, you have to file a return. The return must be filed (meaning signed, properly addressed, and postmarked) no later than Tuesday, April 17, 2012. If you are due a refund, there is no penalty for filing late. However, after April 17, 2012, the statute of limitations will have run for 2008 returns and you’ll be out of luck and your share will become the property of the U.S. Government.

Why might you be due a refund? Maybe you had too much withholding from your wages or made too much him quarterly payments. You might have been eligible for the Recovery Rebate Credit because you didn’t get a stimulus check that year (assuming you were entitled to one). You might have also been eligible for the Earned Income Tax Credit (EITC). These are refundable credits – but you can’t receive the benefit of them unless you file.

Of course, if you owe the feds money (for student loans or back taxes, for example) or if your refund is otherwise earmarked for seizure (such as child support obligations), your refund will be offset by the amounts owed.

If you need a copy of the 2008 tax form, you can download one as a pdf here, visit the IRS website or call toll-free 800-TAX-FORM (800-829-3676). Remember that you’ll need your forms W-2, 1098, 1099 or 5498 from 2008 in order to file; if you don’t have them, request copies from your employer, bank or other payer. If that doesn’t work, you can try ordering them from IRS.gov, filing a federal form 4506-T (downloads as a pdf), or by calling 800-908-9946.

The IRS was kind enough to reply to my request for information about the discrepancy in filing dates for the form 1099 series and the W-2 series. They acknowledged that I was “right about the difference between 1099s and W-2s” but declined to comment on any sort of penalty relief for those who might be affected by the confusion.

Instead, the IRS stated:

Please note that most employers, banks, and other payers now file W-2 and 1099 series forms electronically. The due date for e-filed returns is normally March 31, but, because that’s a Saturday this year, businesses actually have until April 2, 2012, to e-file.

The point is well taken regarding e-filed returns. And I know the IRS is desperate for folks to e-file. But not everyone e-files. The rule is:

If you are required to file 250 or more information returns, you must file these returns electronically. The 250-or-more requirement applies separately to each type of form. For example, if you must file 500 Forms 1098 and 100 Forms 1099-A, you must file Forms 1098 electronically, but you are not required to file Forms 1099-A electronically. The electronic filing requirement does not apply if you request and receive a waiver.

You see, with all due respect to my friends at Ernst & Young and the other big accounting firms, as well as those in the banking industry, and large employers and companies like IBM and Apple, I’m not worried about you. I think you’ll be okay. You already know the rules and you generally pay tax professionals a pretty decent sum to make sure that you don’t miss important deadlines.

But I am concerned about our small business owners, including accounting firms that aren’t in the Big Four, those that don’t file 250 or more information returns. Tax rules can be complicated. And it seems more and more that we’re operating under the assumption that everyone is on the same playing field when they’re clearly not.

I hope that IRS – and those in Congress – remember our small businesses when they write the rules and draft legislation; those businesses are increasingly being overlooked. That entrepreneurial spirit that made America great is getting squashed underneath a myriad of small business-unfriendly legislation.

I see it in my own neighborhood. In Philadelphia, corner stores are disappearing. You don’t see many shoeshine guys at the train station anymore. I can’t find anyone to fix my back door because there are few handyman type businesses in operation. Is it all about taxes? Of course not. I realize there are practical and cultural reasons why we see fewer small businesses opening their doors. But a complex Tax Code, combined with a shifting sense of what is manageable, is certainly contributing to the problem.

The Internal Revenue Service (IRS) IRS has announced its “Dirty Dozen” tax scams for 2012. There are some familiar scams making the list this year with a handful of new-ish ones thrown in for good measure. The best way to protect yourself is to know what you’re up against. Be informed. Here’s the dish on this year’s Dirty Dozen tax scams:

1. Identity Theft. It’s no surprise to see identity theft at the top of the list for 2012. There’s been a definite increase in efforts across the board to steal identities. With respect to the IRS, the information is used to file fraudulent tax returns in order to get a bogus refund. And it can happen to anyone – trust me, someone did this to my mother (grr).

As an effort to get a handle on the problem, the IRS is cracking down. Now, together with the Tax Division of the Department of Justice and local U.S. Attorneys’ offices, the IRS is actively investigating instances of fraud and identity theft and prosecuting those responsible. If you believe your personal information has been stolen and used for tax purposes should immediately contact the IRS Identity Protection Specialized Unit.

2. Phishing. Also near the top of the list: phishing. Phishing scams usually involve fake emails and bogus web sites. The idea is to get you to turn over personal information or to click on a link that may install malware on your computer that can track your keystrokes or otherwise glean access to your financial information. Recent examples can be found here and here.

I’ve preached it before: the IRS does not initiate contact with taxpayers about your tax account by email. Ever.

3. Return Preparer Fraud. Most tax pros are good people. Some are not. Some will take your refund, charge too much for services or talk you into claiming deductions or credits for which you are not entitled. I’ve seen it all. And it usually comes back to haunt you.

Make good choices when you seek out your tax professional. If you don’t feel good about your preparer, it is perfectly okay to walk away. You’re not in a committed relationship, you don’t have to lie about staying home to wash your hair. Find someone who has proper credentials, returns calls, and answers your questions. Avoid preparers who are rude and patronizing, hard to locate when you have a question, and who bases their fees on percentages of your refund. You can find more tips on finding a tax professional here.

4. Hiding Income Offshore. Offshore accounts are totally legitimate. However, using offshore accounts to hide income for tax purposes is illegal. Identifying taxpayers using offshore accounts to evade taxation is a top IRS priority. Reporting offshore income is mandatory for U.S. taxpayers. Reporting offshore accounts is required if the aggregate of those accounts reaches $10,000 in any calendar year. Failure to comply can result in some pretty nasty penalties and potential criminal prosecution.

If you need to comply and you haven’t yet done so, the IRS has a limited amnesty program available for taxpayers. Ask your tax professional for more information.

5. “Free Money” from the IRS & Tax Scams Involving Social Security. C’mon folks. If the government were giving out money, would it stay a secret for long? Be wary of scams touting “free money” from the IRS or Social Security rebates; these have been popping up all over the country but have seemed to focus on churches as a way of sucking you in. Don’t fall for it.

6. False/Inflated Income and Expenses. There are lots of ways to couch this scam. The IRS refers to it as “including income that was never earned… in order to maximize refundable credits such as the Earned Income Tax Credit.” I call it plain ol’ lying. There’s a simple way not to get caught up in this scam, often proposed by unscrupulous preparers (see #3 above): don’t make stuff up.

7. False Form 1099 Refund Claims. I can’t understand why this scam won’t die. The premise underneath this scam is that the federal government maintains secret accounts for taxpayers and all you have to do to get it is file a fake form 1099 Original Issue Discount (OID) with the IRS. Read that out loud and see if you can do it without bursting out laughing halfway through. Secret accounts. Fake tax forms. It sounds like a bad movie. If you get involved with such nonsense, you will be subject to penalties and possible criminal prosecution.

8. Frivolous Arguments. You have every right to make a legitimate argument to reduce your tax liability. You don’t have the right to just make stuff up (see again #6). The IRS has heard just about every crazy argument under the sun and time after time, these are shot down in court. They range from “The filing of a tax return is voluntary” to “Only foreign-source income is taxable” to my personal favorite, “Compelled compliance with the federal income tax laws is a form of servitude in violation of the Thirteenth Amendment.” All bogus. So are the notions of reparation tax credits, corporation sole, Social Security refunds, and the form 1040 not being legitimate because it doesn’t have an OMB control number as required by the Paperwork Reduction Act. Don’t waste your time with these arguments. Doing so can subject you to penalties and possibly land you in prison.

9. Falsely Claiming Zero Wages. Again, if it has the word “fake” or “phony” or “false” in front of it, you know it’s wrong. So filing a phony information return is wrong and illegal. There is a scam that suggests that if you file a federal form 4852 (Substitute Form W-2) or a “corrected” Form 1099, you can reduce your income to zero and get a refund. Um, no. This never works. Ask Wesley Snipes.

10. Abuse of Charitable Organizations and Deductions. There are a couple of scams stemming from charitable deductions. In one arrangement, donors don’t really relinquish control over assets for which they claim a deduction. Let me help you out on this: if you don’t actually give it to anyone, not a gift, ‘kay? And when you do make a legitimate donation, make sure the value is stated correctly. Nobody’s paying $100 for those nasty acid-washed jeans. And that china set that’s missing a few teacups and a serving platter, not a full set anymore. Let’s be honest: there’s a reason you’re getting rid of most of that stuff. Note it appropriately.

11. Disguised Corporate Ownership. Lawyers like me like to set up corporate entities for all kinds of reasons from liability protection to gifting opportunities. Setting up corporate entities to try and confuse the IRS for purposes of tax avoidance or money laundering, however, is not a legitimate corporate purpose. The general rule here is that you can’t do something one way for tax purposes that you couldn’t do another: you can’t make something deductible simply by tossing it into a company.

12. Misuse of Trusts. I love trusts. I think they can be really great ways to plan for incapacity, consolidate and manage assets, provide privacy for beneficiaries, and effectuate distribution from an estate. Structured properly, trusts can even assist with asset protection and tax savings. They can’t be used to hide assets from creditors or avoid paying legitimate taxes on income and estates. If it sounds too good to be true, it probably is. Make sure you understand the real benefits of any trusts before you sign on the dotted line.

Inevitably when a taxpayer comes to me after getting pulled into one of these type scams, they start out by saying something like, “It didn’t sound right but…”  Stop right there. That’s all you need. If it doesn’t sound/feel/smell right, walk away. Or ask for a second opinion. I know an extra phone call feels like a hassle but look at it this way: would you rather be calling your tax lawyer now or your criminal lawyer later… from prison? I think we know the answer to that one.

Remember the newly expanded tax credit for hiring veterans that was passed last year?

The Internal Revenue Service (IRS) has finally issued more guidance on the credit. The Returning Heroes and Wounded Warriors Work Opportunity Tax Credits were part of the VOW to Hire Heroes Act of 2011, which was announced on Veterans Day last year. The credit gives employers a tax credit for hiring qualified veterans. A qualified veteran is defined as a veteran with aggregate periods of unemployment of at least 4 weeks but less than 6 months in the year prior to being hired or with aggregate periods of unemployment of 6 months or more in the year prior to being hired.

The law allows employers a tax credit per veteran. The maximum credit is applicable for employers who hire vets with service-related disabilities. Other factors that affect the amount of the credit include the length of the veteran’s unemployment before hire, hours worked and the amount of wages paid. Also important? Whether the employer is a for-profit employer or a tax-exempt organization.

The IRS has also released the applicable forms. The federal form 8850, Pre-Screening Notice and Certification Request for the Work Opportunity Credit, (downloads as a pdf) must be filed by June 19, 2012, for employers who make a qualified vet hire between November 22, 2011, and May 22, 2012. Eligible employers who make a hire after May 22, 2012, must file the federal form 8850 within 28 days after work begins.

The IRS has confirmed that the form 8850 may be transmitted electronically or via fax, assuming that the state workforce agencies accept submissions in those formats.

To claim the credit, an employer figures the amount on the federal form 5884, Work Opportunity Credit, (downloads as a pdf) and entered on a federal form 3800, General Business Credit, (downloads as a pdf) to be filed together with the employer’s income tax return.

For more information, check out Notice 2012-13 (downloads as a pdf).

One of the frustrating things from a tax professional’s point of view about the magically shifting world of tax credits and deductions on the whims of Congress is that it confuses taxpayers. For 2011, tops on the list of things taxpayers can’t understand is the disappearance of the Making Work Pay Credit. But second? Repayment of the first time homebuyer’s credit.

In case you’ve forgotten all about it, let me quickly refresh your memory. As part of the Housing and Economic Recovery Act of 2008 (HERA) in order to make the realtor lobby happy jump-start the economy, Congress passed a tax credit for first-time homebuyers. Taxpayers who had not owned a principal residence for the three-year period prior to the purchase of a new home were allowed a credit if they purchased a new home between April 9, 2008, and July 1, 2009. For qualifying taxpayers, the credit was up to $7,500 and it was refundable, meaning that if the amount to be refunded exceeded any tax liability, the overage would be issued to the taxpayer.

It wasn’t a freebie. The tax credit must be repaid over a 15-year period or when the house is sold if there is sufficient capital gain from the sale. Payments must begin two years after the credit is claimed, so taxpayers who take the credit in 2008 must begin repayment with the 2010 tax return and taxpayers who take the credit in 2009 would begin repayment on the 2011 tax return. The repayment is a straight line repayment over 15 years with no interest and is “paid” back via a federal income tax return.

But here’s where it gets confusing. In 2009, bowing to continued pressure from the realtor lobby by popular demand, Congress subsequently changed the terms of the credit. As a result, there were two sets of rules in effect for the first half of 2009. Since the change was made mid-year, taxpayers had the option of claiming the first time homebuyer’s credit under the 2008 rules or the 2009 rules. For almost all taxpayers, the 2009 rules were more advantageous because, under those rules, the credit did not have to be repaid.

What that means from a practical standpoint is that taxpayers are now scratching their heads trying to figure out whether they claimed the credit, which version of the credit they claimed, how much credit they originally needed to repay (if any), and how much credit remains unpaid.

It’s taken a bit but the IRS now has an online system available to help out: the First Time Homebuyer Credit Account Look-up. To use the system, you’ll need your Social Security number, date of birth, street address, and zip code. The system is supposed to allow taxpayers access to information about the balance of the First Time Homebuyer Credit; total amount of the credit; annual installment repayment amount and the amount paid back to date.

Supposed to. If it’s not working, you can call a special toll free number at IRS to access information about your account: 1.800.919.0352.

It’s cold and snowy out today in Philadelphia and across much of the country. It’s the kind of day where you really should stay inside and get things done… like maybe your taxes.

The Internal Revenue Service (IRS) previously declared that the 2012 tax season has officially kicked off and this week, the IRS proclaimed that the 2012 electronic tax return filing season (or e-file to you and me) was now open for business.

The IRS has come a long way from the 1980s when e-file was still a novelty. In 1986, only 25,000 returns were e-filed. Last year, the IRS took on McDonald’s-like numbers, announcing more than “one billion served” in total. Of those, more than 112 million income tax returns were e-filed in 2011, representing 77% of all individual returns filed. The numbers are climbing so quickly that the IRS hasn’t automatically put forms in the mail for a couple of years now.

Why does the IRS encourage e-file? In a word: cost. When you e-file, you’re not just saving paper, you’re saving tax dollars. IRS Commissioner Doug Shulman claims that “an e-file return costs us 20 times less to process than a paper return, this program means a more efficient government that has saved America’s taxpayers hundreds of millions of dollars.”

The IRS also claims that e-file is faster, more efficient, and more accurate for taxpayers. Statistically, error rates for e-filed returns are just 1%, compared to a 20% error rate for traditional paper returns.

If you want to e-file, you aren’t locked into doing your returns yourself. There a few ways taxpayers can e-file their tax returns: using a tax return preparer, using software programs like TurboTax or TaxACT on your home computer, or through IRS Free File. No matter which option you choose, be aware that the IRS does not charge for e-file. Fees associated with e-file might be imposed by your preparer or the software program but there is no charge from the IRS.

Also, keep in mind that e-filing doesn’t mean that you have to pay early if you owe – and it doesn’t mean that you have to use a credit card. You can e-file early and still pay with a payment voucher all the way up to April 17 (the due date for taxes this year). You can use a credit card to pay or pay by check. For the younguns, checks are those paper things from banks that women like me keep in their pocketbooks; believe it or not, you can use them to pay for stuff (in my hometown, you can still buy groceries with them).

Finally, what about those RALs (Refund Anticipation Loans)? I know you think they’re faster than the alternative but consider this: if you e-file and use direct deposit, you can get your money back in about 10 days, sometimes even faster. And not a penny of interest out of your pocket. Promise me that you’ll think about it.

If you’re not ready to file today (because, for example, your forms haven’t arrived yet), you could try finding a tax preparer that you like or spend the day opening mail and getting organized.

Of course, all of that said, I know what I’m going to do: go play in the snow with the kiddos and the dog (yes, that’s my dog in the picture above). Enjoy your day!

My seven-year-old has a penchant for getting herself into trouble. She’s that kind of kid who pushes boundaries to see exactly how far she can get. Lucky for her, she also has a pretty quick wit and a couple of looks up her sleeve. When she gets into trouble, she peers up at me and begs, “One more chance!” You, of course, know exactly why she does this: I usually give in.

Yeah, I know better. But I do it anyway. I feel like maybe this time – this time – she’ll learn her lesson.
The IRS isn’t so very different. In a surprise move, the IRS has announced that they’re giving “One more chance!” to those folks with offshore accounts.

It’s deja vu all over again. In February 2011, IRS Commissioner Doug Shulman announced the Offshore Voluntary Disclosure Initiative (OVDI), saying:

As we continue to amass more information and pursue more people internationally, the risk to individuals hiding assets offshore is increasing. This new effort gives those hiding money in foreign accounts a tough, fair way to resolve their tax problems once and for all. And it gives people a chance to come in before we find them. (emphasis added)

Only last year, I totally expected it. This move, I’ll admit, I didn’t see coming. I thought “once and for all” really meant once and for all.

I guess $4.4 billion can change your mind pretty quickly. That’s the total amount of taxes collected by the IRS under the previous two programs, one in 2009 and the most recent in 2011. That total is expected to climb as the IRS processes the 2011 disclosures, including those which were extended due to Hurricane Irene.

The new program hopes to further increase compliance and – hopefully – add some more dollars to the Treasury. But there’s a catch – and it’s a pretty big one: there are no rules.

Okay, maybe that’s a bit dramatic. There are some rules. The IRS just reserves the right to change them at any time.

For example, there’s no deadline for compliance. That’s the kind of thing that is going to give tax professionals like me a headache. We like deadlines. But the IRS has not set a deadline. They can end the program at any time.

Also? The existing terms of the program may change at any time going forward. According to the IRS, they “may increase penalties in the program for all or some taxpayers or defined classes of taxpayers.”

So, er, I guess the strategy is to keep taxpayers guessing? Or encourage compliance as early as possible?

For the record, as it exists right now, individuals who participate in the program will pay a penalty of 27.5% (up from 25% in the 2011 program) of the highest aggregate balance in foreign bank accounts or value of foreign assets during the eight full tax years prior to the disclosure. As in 2011, if circumstances warrant, some taxpayers will be eligible for penalties of just 5% or 12.5%.

To qualify, participants in the program must file all original and amended tax returns for up to years prior to the disclosure. Payment must also be made for the taxes and interest due as well as applicable penalties.

Further, taxpayers who have come forward since the previous OVDI closed last year will be eligible to participate in the new program.

Again, that could all change. But that’s how it stands as of now.

For its part, the IRS believes that this new opportunity is a good one for taxpayers. Commissioner Shulman offers:

As we’ve said all along, people need to come in and get right with us before we find you. We are following more leads and the risk for people who do not come in continues to increase.

This is a tricky area. I’ve been critical of the underlying laws requiring disclosure. I believe that it pulls too many taxpayers into noncompliance by accident. Under the rules, taxpayers who pay taxes on their foreign income but don’t properly disclose the specific accounts are breaking the law. And taxpayers who have modest foreign accounts for things like paying tuition for study abroad programs, internships or travel, can find themselves noncompliant. Also at risk? Executives and workers in the US on temporary visas and dual citizens. Not your run of the mill tax scofflaws as the IRS would paint them.

But folks who just didn’t understand and comply with the rules.

So, in that regard, I think that these efforts to give taxpayers “One more chance!” make sense. I’m just not a fan of the constantly moving target now in effect.

Yes, yes, taxpayers should get compliant as soon as possible. And I don’t believe in rewarding those who wait.

But – and I know this is crazy talk – maybe there’s an alternative to disclosure program after disclosure program meant to weed out the bad guys? Maybe we should change the rules altogether. Why not rewrite the laws so that people who weren’t intended to get caught up in the whole mess to begin with aren’t affected? I know that would take some effort on the part of Congress and (deep breath) cooperation (and goodness knows that’s asking for a lot) but wouldn’t it make more sense?

*Sigh* For now, it is what it is.

Of course, if the “One more chance!” thing doesn’t work, we can always try what we do to the seven-year-old: straight to bed with no TV and no more dancing in your room.

The IRS has announced that the 2012 tax season is officially open. Well, sort of. The IRS has opened its doors for the season but what you can do just yet is still limited: e-file and Free File returns won’t be accepted until January 17, 2012. Today, however, you can (and should) start getting your information in order. The IRS opening the tax season is kind of the equivalent of catchers and pitchers reporting for spring training.

The IRS also announced that taxpayers will have a couple of extra days to file their 2011 tax returns in 2012. Taxpayers will have until Tuesday, April 17, 2012, to file their 2011 tax returns and pay any tax due. Make a note. It’s not Monday, April 16, 2012, as some media outlets are reporting.

Here’s why there’s some confusion: April 15 falls on a Sunday this year. So, you skip to the next business day which would normally be Monday, April 16. However, April 16 is also Emancipation Day, a holiday observed in Washington, D.C. Emancipation Day marks the anniversary of the day that President Lincoln signed the Compensated Emancipation Act which freed 3,100 slaves in the District, making DC residents the “first freed” by the federal government. The holiday was celebrated annually after the Civil War for many years; there was a break in the observance of the holiday in 1901 and celebrations didn’t resume until more than 100 years later. In 2005, Emancipation Day was made an official public holiday in D.C. That’s significant because, under federal law, D.C. holidays which are observed have an impact on tax deadlines in the same way that federal holidays do. That means that Tax Day cannot land on April 16, so taxpayers all over the country have the benefit of the extension to April 17, 2012.

Don’t assume that the extra two days moves all individual federal income tax deadlines forward because it does not. The overseas exception due date will still be June 15, 2012, and individual federal income tax returns on extension will be due on October 15, 2012 (not simply 6 months forward to October 17, 2012).

So taking all of that into consideration, as of today, you have 102 days left before Tax Day. Yep, that’s actually three extra days: it’s a leap year.

Will the extra days help out taxpayers? I don’t think so. But it certainly can’t hurt.