IRS pushes tax season to later date; what does this mean for stimulus checks

Families who aren’t eligible for the higher child credit may still be able to claim $2,000 credit per child. Texas, Oklahoma and Louisiana residents were previously given a June 15 deadline to file taxes because of the winter storm that swept through those states in February. Traditionally, scores of businesses use tax day as a chance to run promotions to lure people in. The number of companies that are offering freebies this year is down significantly, as they try to recover from the downswing in business brought on by the pandemic. In 2018, the online service went offline owing, in part, to a flood of people who had waited until the last moment.

Will the unemployment waiver work for states taxes, too?

The IRS said other problems and delays could take place with issuing refunds if the filing season were opened without taking the time to first fix its programming. Corbin said taxpayers should try to resolve issues first and not contact the IRS until late February if there continue to be problems with these forms, many of which should have been received already. Under Michigan state law, taxpayers are required to pay quarterly estimated tax payments when the annual tax due is expected to exceed $500 or more. Taxpayers who fail to pay an estimated quarterly tax payment are typically subject to penalties and interest. The likelihood of a third stimulus payment of up to $1,400 for individuals is on the table now.

• No action is needed for eligible taxpayers to receive these payments unless you haven’t yet filed a 2021 tax return.
• Payments will be automatically deposited using the banking information listed on the taxpayer’s 2023 tax return or sent by paper check.
• So it’s possible that if both lost work in 2020, a married couple filing a joint return might not have to pay federal income taxes on up to $20,400 in jobless benefits.
• The Tax Cuts and Jobs Act, which took effect in 2018, eliminated the ability of employees who receive a W-2 from their employer to deduct home office expenses.
• Families who aren’t eligible for the higher child credit may still be able to claim $2,000 credit per child.
• The legislation allows you to deduct up to 100% of your adjusted gross income, though you will need to itemize the deductions.

Table 3. 2025 Alternative Minimum Tax (AMT) Exemptions

About $2.4 billion worth of stimulus checks will be distributed among some taxpayers in the coming weeks, the IRS announced Friday. These stimulus checks are part of the Covid-era payments that were authorized by Congress to financially help citizens that were struggling during the pandemic. Experts say people should be aware of certain situations, including working in a different state or claiming a stimulus payment, that could affect their tax liability. The 2021 tax season is about to get underway, Irs Tax Season 2021 Kicks Off Today From Stimulus Checks To Unemployment and taxpayers will see some changes ushered in by the coronavirus pandemic that could affect their returns. The maximum child tax credit is $2,000 per qualifying child and is not adjusted for inflation.

Table 7. 2025 Qualified Business Income Deduction Thresholds

If all goes smoothly with passing the necessary legislation, some speculate that payments could be out as early as mid-March. Still, some Americans who made sure to file electronically on Feb. 12 when tax season kicked off contacted USA TODAY this month and said they were still waiting for the IRS to process their returns. Roughly 7.6 million returns haven’t been processed yet so far this tax season, according to IRS filing statistics through the week ended March 12. That’s nearly three times the number in the same period last year, when 2.7 million faced delayed processing. Tax Day 2021 has been pushed back to May 17 from April 15 without penalties and interest, giving Americans more time to file their returns as the IRS implements sweeping tax code changes from the latest COVID-19 relief package. The IRS will begin accepting and processing 2020 tax returns on Feb. 12, the agency said Friday.

Letter from the IRS

The credit will begin to phase out for those earning more than $75,000 a year, or $150,000 for those married filing jointly. The IRS will look to prior-year tax returns to determine who qualifies for the higher credit. If a return for 2020 hasn’t been filed yet, the agency will look to 2019 returns. Any taxpayer who feels they will need more time to file their 2020 income taxes can get an automatic extension by filing Form 4868 and will have until October 15 to do so.

The refundable portion of the child tax credit is adjusted for inflation and will remain at $1,700 for 2025. Certain taxpayers may qualify to get free tax return preparation and electronic filing help at a location near where they live. For more information, see Volunteer Income Tax Assistance and Tax Counseling for the Elderly. If you are jobless in 2021, and receiving unemployment compensation, you may want to take action to have federal taxes withheld in the future. The tax season shocker for many jobless people will be that their tax refund could be far smaller than expected or they might even owe taxes.

The government sent out checks of $1,200 and $600 to millions of Americans in 2020 as the pandemic shut down most of the country. They are being treated like a refundable tax credit, so they’re similar to an advance on money you would have received as part of your refund. The combination of unique economic and tax policy circumstances may affect refunds both for individual taxpayers and in the aggregate. Adjustments for the latest round of $1,400 economic impact payments through the ARPA will be made in the 2022 tax filing season.

• Internal data reviewed by the IRS found that many people who filed a tax return in 2021 failed to claim the Recovery Rebate Credit, prompting the revenue service to issue the batch of «special» automatic payments.
• The IRS has defined «qualified taxpayers» as those who filed a 2021 tax return but left the data field for the Recovery Rebate Credit or filled out $0 when the individual was eligible to receive the credit.
• The Columbus, Mississippi, resident, who makes $11 an hour as a personal shopper at Walmart, has fallen a few months behind on her car payments after her hours were reduced amid the coronavirus pandemic.
• Overpaying taxes can be viewed as an interest-free loan to the government.

«We always encourage taxpayers to file the most accurate return they can,» Corbin said. The IRS is encouraging people to avoid the possible headaches and holdups that can take place when you’re filing a paper return during the pandemic. Corbin said choosing to file electronically is the safest way to file a return and the quickest way to get a refund. You can use the IRS “Where’s My Refund” tool to check the status of your tax refund. Enter your Social Security number or ITIN, your filing status and your refund amount. There is also a mobile app, called IRS2Go, that you can use to check your refund status.

If your W-2 is blank because you are exempt from tax, do you have to send it to the IRS?

For the first stimulus, people were able to use the IRS “non-filers tool” to register at IRS.gov, but the tool is no longer active. If people aren’t able to register on this tool, they will have to file a tax return to claim the Recovery Rebate Credit for the first two stimulus checks that were distributed last year. Taxpayers are also eligible for the stimulus check if they failed to fill out the Recovery Rebate Credit field on their 2021 tax returns, or if the field was filled out incorrectly.

When it comes to getting paperwork ready, you’ll want to dig up the IRS Notice 1444 for the stimulus payment amount you were issued in 2020. If you already received more stimulus money than you would have qualified for based on your 2020 situation, then you don’t have to repay the difference, Luscombe said. The IRS noted that it issued two Economic Impact Payments as part of the economic stimulus efforts, effective last year. The second payment officially began rolling out on Dec. 30 but only was available to many people beginning in January and the payments will continue into February for some. The pandemic and the economic fallout create special tax headaches, too.