View All | September 2023 Newsletter Edition

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Requested an Extension? Avoid Last-Minute Filing

Did you request an extension to file your tax return after the standard April 18, 2023, deadline? If so, you now have until Oct. 16 to prepare and file it with the IRS. Don’t wait until the last minute! As soon as possible, gather your records for the 2022 tax year and make an appointment with us to prepare your return.

If you’re concerned about paying tax owed, be aware that the IRS offers short- and long-term payment plans, as well as installment agreements, to taxpayers who qualify. It’s important to act quickly, because any amount that was due April 18 accrues interest until the balance is paid. Contact us with questions.

Be on the Lookout for a New Fraud Scam

The IRS is warning taxpayers about yet another fraud scam. Be suspicious if you receive a cardboard envelope from a delivery service claiming to be from the IRS. The enclosed letter will be riddled with typos and inaccuracies and mention an “unclaimed refund.” It will ask you to reply with “filing information,” including your Social Security number and photos of your driver’s license.

Ignore these types of communications purporting to be from the IRS and asking for personal information. This one asks recipients to respond via phone or email. Don’t reply! The fraudsters behind the letter want to steal your identity and, possibly, your tax refund. Click here to learn more.

Some Tax Help with the Cost of Kids

Raising kids is costly. That’s true of biological kids, kids you may adopt and the children of relatives that you may be raising, such as your grandkids. Thankfully, there are several tax breaks that may help.

Here’s what you need to know: to qualify for tax breaks for your dependent kids, each will need their own Social Security number, Adoption Tax ID number, or Individual Tax ID number. Adding a dependent to your household may reduce your tax bill, so check your withholding. Also, you may be eligible for the Child Tax Credit, the Credit for Other Dependents, the Adoption Tax Credit and the Earned Income Tax Credit. Click here for more information from the IRS.

What Can Happen When Taxes Go Unpaid?

If a taxpayer fails to pay the IRS following a tax assessment, the agency can take legal action to collect the overdue tax. Options include filing liens and issuing levies to claim and seize the delinquent taxpayer’s property. In one new case, a federal appeals court ruled that the U.S. Tax Court properly sustained the IRS’s lien and levy on a married couple’s property to collect more than $500,000 in outstanding tax liabilities. The couple unsuccessfully argued that the statute of limitations for the IRS’s assessment of the tax had passed and that the IRS didn’t mail them adequate notice when it began auditing their business. (Goldberg, CA-7, 7/14/23)

Revised Dates for Required IRA Distributions

The SECURE 2.0 Act made several changes that affect the beginning dates for required minimum distributions (RMDs) from IRAs. The changes made by the IRS are for the purpose of providing transition relief to IRA owners and some beneficiaries. Specifically, in Notice 2023-54, the IRS is extending the rollover deadline for certain distributions that were mischaracterized as RMDs. In addition, the relief allows beneficiaries under the 10-year rule to avoid taking RMDs in 2023.

The IRS also said that its upcoming final regs regarding RMDs won’t apply until the 2024 distribution calendar year. This is the second time the IRS has amended the applicability date. Read Notice 2023-54 here.

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