Tax filing season officially began on January 24! Given the circumstances around the pandemic and unique challenges for this tax season, the IRS offers a 5-point checklist that can help many people speed up tax return processing and refund delivery while avoiding delays.
Due to the complicated tax changes made over the pandemic, we recommend using a trusted Tax Professional to prepare your 2021 taxes, such as Beacon Tax Services. Beacon Tax is a professional tax service company helping individuals, families, and small businesses reduce tax liabilities while providing helpful advice. From individual tax returns to comprehensive tax planning, Beacon Tax helps clients understand their whole financial picture so they do not pay more than necessary.
Here is what the IRS stated would be helpful when thinking through the 2021 Tax Season:
- File an accurate return and use e-file and direct deposit to avoid delays. Taxpayers should electronically file and choose direct deposit as soon as they have everything they need to file an accurate return. Taxpayers have many choices, including using a trusted tax professional, such as BEACON TAX SERVICES. For those using e-file, the software helps individuals avoid mistakes by doing the math. It guides people through each section of their tax return using a question-and-answer format.
- For an accurate return, collect all documents before preparing a tax return. If applicable, make sure stimulus payment and advance Child Tax Credit information is accurate. In addition to collecting W-2s, Form 1099s and other income-related statements, it is important people have their advance Child Tax Credit and Economic Impact Payment information on hand when filing.
- Advance Child Tax Credit letter 6419: In late December 2021, and continuing into January, the IRS started sending letters to people who received advance CTC payments. The letter says, “2021 Total Advance Child Tax Credit (AdvCTC) Payments” near the top and, “Letter 6419” on the bottom right hand side of the page.
- Third Economic Impact Payment letter 6475: In late January 2022, the IRS began issuing letters to people who received a third payment in late January 2021. The letter says, “Your Third Economic Impact Payment” near the top and, “Letter 6475” on the bottom right hand side of the page.
Both letters – 6419 and 6475 – include important information that can help you file an accurate 2021 tax return. If a return includes errors or is incomplete, it may require further review while the IRS corrects the error, which may slow the tax refund.
- If contacting the IRS, Avoid lengthy phone delays by using online resources. Phone demand on IRS assistance lines remains at record highs. To avoid lengthy delays, the IRS urges people to use IRS.gov to get answers to tax questions, check a refund status or pay taxes. There’s no wait time or appointment needed — online tools and resources are available 24 hours a day.
- Still waiting on a 2020 tax return to be processed? Special tip to help with e-filing a 2021 tax return: In order to validate and successfully submit an electronically filed tax return to the IRS, taxpayers need their Adjusted Gross Income, or AGI, from their most recent tax return. For those waiting on their 2020 tax return to be processed, here’s a special tip to ensure the tax return is accepted by the IRS for processing. Make sure to enter $0 (zero dollars) for last year’s AGI on the 2021 tax return. For those who used a Non-Filer tool in 2021 to register for an advance Child Tax Credit or third Economic Impact Payment in 2021, they should enter $1 as their prior year AGI. Everyone else should enter their prior year’s AGI from last year’s return. Remember, if using the same tax preparation software as last year, this field will auto-populate.
- Free resources are available to help taxpayers file. During this challenging year, the IRS reminds taxpayers there are many options for free help, including many resources on IRS.gov. For those looking to avoid the delays with a paper tax return, IRS Free File is an option. With Free File, leading tax software providers make their online products available for free as part of a 20-year partnership with the Internal Revenue Service. This year, there are eight products in English and two in Spanish. IRS Free File is available to any person or family who earned $73,000 or less in 2021.
Are you concerned about the 2021 Tax Season? Let Beacon Tax help you get your taxes done correctly while saving you every tax dollar possible!
Visit BeaconTax.org for more information, or call us at (800) 588-6800.