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Taxpayers can get faster tax refunds with Direct Deposit 

Taxpayers can get faster tax refunds with Direct Deposit 

WASHINGTON — With the tax deadline nearly here, the Internal Revenue Service encourages all taxpayers to join the 80 percent of filers who choose Direct Deposit to get their tax refund faster.

Direct Deposit into a bank or other account is a secure option. It avoids the possibility of lost, stolen or undeliverable refund checks. The IRS uses the same system to deposit tax refunds that Social Security and Veterans Affairs use to deposit 98 percent of benefits into millions of accounts.

Choosing Direct Deposit is easy when electronically filing. A taxpayer – or their tax preparer – simply selects it as the refund method in their tax software and enters account and routing numbers. Paper filers should follow the instructions on their tax form. With either method, double check entries to avoid errors.

Direct Deposit also saves taxpayer money. It costs the IRS more than $1 to issue a paper refund check, but only a dime for each direct deposit.

E-file plus Direct Deposit yields fastest refunds

The IRS urges taxpayers to file electronically. While a person can choose Direct Deposit no matter how they file, e-filers will typically see their refund in fewer than 21 days.

Taxpayers can use IRS Free File or commercially available tax software to electronically file. E-filing vastly reduces tax return mistakes, as the tax software does the calculations, flags common errors and prompts taxpayers for missing information. The tax software also reflects tax law changes, such as those from the Tax Cuts and Jobs Act, so taxpayers don’t need to know all the details to make sure they’re getting their taxes done right.

Split refunds

A taxpayer can deposit their full tax refund into one account or split the refund into two or three financial accounts, including a bank or Individual Retirement Account. Part of the refund can even be used to purchase up to $5,000 in U.S. Series I Savings Bonds.

When filing electronically, a taxpayer can split their refund by using the process outlined in the tax software. Those filing a paper return split a refund by using IRS Form 8888, Allocation of Refund (including Savings Bond Purchases).

The IRS reminds taxpayers they should only deposit tax refunds directly into accounts that are in their name, their spouse’s name or both if it’s a joint account. No more than three electronic tax refunds can be deposited into a single financial account or prepaid debit card. Taxpayers who exceed the limit will receive an IRS notice.

Tracking a tax refund

Taxpayers can track their refund using “Where’s My Refund?” It’s available on IRS.gov or by downloading the IRS2Go mobile app. “Where’s My Refund?” is updated once daily, usually overnight, so there’s no reason to check more than once per day. The “Where’s My Refund?” tool has the same status information as IRS phone staff. Taxpayers can check “Where’s My Refund?” within 24 hours after the IRS has received their e-filed return. Paper filers can check four weeks after they mailed their paper return. “Where’s My Refund?” has a tracker that displays progress through three stages: (1) Return Received, (2) Refund Approved, and (3) Refund Sent.

Other last-minute tips from IRS

Extensions. April 15, 2019, is the deadline for most to pay taxes owed and avoid penalty and interest charges. Because of the Patriots’ Day holiday on April 15 in Maine and Massachusetts and the Emancipation Day holiday on April 16 in the District of Columbia, taxpayers who live in Maine or Massachusetts have until April 17 to file their tax returns and pay any taxes they owe.

If a taxpayer needs more time to file, they can avoid a late-filing penalty by requesting an extension of time to file. An extension of time to file is not an extension to pay. Taxpayers can file up to six months later when they have an extension, but their tax payment is still due by the original due date.

There are several ways to get an extension:

  • Use the Free File link on IRS.gov.
  • File Form 4868, Application for Extension of Time To File U.S. Income Tax Return, electronically or by mail.
  •  Make an electronic payment and designate it as an extension payment. Taxpayers can get an automatic extension of time to file when making a full or partial payment with Direct Pay, the Electronic Federal Tax Payment System or by debit or credit card. When paying electronically, taxpayers must select Form 4868 as the payment type and choose the payment date to get the automatic extension. With this method, there’s no need to file a paper or electronic Form 4868. However, taxpayers should keep the confirmation as proof of the payment and extension. With Direct Pay and EFTPS, taxpayers can request email notifications about their payment.

Payment options. Taxpayers who owe taxes can use IRS Direct Pay or any of several other electronic payment options. They are secure and easy and taxpayers receive immediate confirmation of their payment. Or, taxpayers can mail a check or money order payable to the “United States Treasury” along with a Form 1040-V, Payment Voucher. Taxpayers who can’t pay by the tax deadline often qualify to set up a monthly payment agreement with the IRS using the Online Payment Agreement option on IRS.gov.

Paycheck Checkup. The IRS encourages taxpayers to do a Paycheck Checkup to review their tax withholding. They can use the IRS Withholding Calculator and should make any needed adjustments early in 2019. Doing a Paycheck Checkup can help taxpayers avoid having too little or too much tax withheld from their paychecks. Taxpayers can generally control the size of their refund by adjusting their tax withholding.

For 2019, a Paycheck Checkup is especially important for taxpayers who adjusted their withholdings in 2018 – specifically in the middle or later parts of the year. It’s also important for taxpayers who owed additional tax when they filed this year or those who want to adjust the size of their refund for next year. When using the calculator, it’s helpful for taxpayers to have their completed 2018 tax return available. For details see Tax withholding: How to get it right.

Beware of scams. Watch out for email schemes.Taxpayers will only receive an email from Direct Pay or EFTPS if they’ve opted in for email notifications when they use Direct Pay or EFTPS. Taxpayers who get an unsolicited email claiming to be from the IRS or an IRS-related function should report it to phishing@irs.gov.

For further help and resources, check out the IRS Services Guide.

More information:

Visit IRS.gov for answers to 2019 tax-filing season questions

Visit IRS.gov for answers to 2019 tax-filing season questions

With major changes made by the Tax Cuts and Jobs Act, the IRS encourages business owners and self-employed individuals seeking more information on tax reform to review Publication 5318, Tax Reform What’s New for Your Business. Visit the IRS Tax Reform and Get Ready pages on IRS.gov for additional information.

Choosing e-file and direct deposit remains the fastest and safest way to file an accurate income tax return and receive a refund. “Where’s My Refund?” has the most up-to-date information available about refunds. The tool is updated once daily, so taxpayers don’t need to check more often

Not too early: Here are steps to get ready to file their taxes in 2019

Not too early: Here are steps taxpayers can take now
to get ready to file their taxes in 2019

The IRS reminds taxpayers there are steps they can take now to make sure their tax filing experience goes smoothly next year. Taking these steps will also help them avoid surprises when they file next year.

To help get people the information they need, the IRS just updated a special page on IRS.gov with steps to take now for the 2019 tax filing season.

Check withholding – do a Paycheck Checkup soon
Since employees typically only have one or two pay dates left this year, checking withholding soon is especially important. Because of the many changes in the tax law, refunds may be different than prior years for some taxpayers. Some may even owe an unexpected tax bill when they file their 2018 tax return next year. To avoid these kind of surprises, taxpayers should do a Paycheck Checkup to help  them decide if they need to adjust their withholding or make estimated or more tax payments now.

Gather documents
The IRS urges all taxpayers to file a complete and accurate tax return by making sure they have all the needed documents before they file their return. This includes their 2017 tax return and:

  • Year-end Forms W-2 from employers,
  • Forms 1099 from banks and other payers and
  • Forms 1095-A from the Marketplace for those claiming the premium tax credit.

Taxpayers should confirm that each employer, bank or other payer has a current mailing address or email address. Typically, these forms start arriving by mail – or are available online – in January. Check them over carefully, and if any of the information shown is inaccurate, the taxpayer should contact the payer right away for a correction.

Taxpayers should keep a copy of any filed tax return and all supporting documents for at least three years. Also, taxpayers using a software product for the first time may need the adjusted gross income amount from their 2017 return to properly e-file their 2018 return.

Choose e-file and direct deposit for a faster refund
Electronically filing a tax return is the most accurate way to prepare and file. Errors delay refunds, and the easiest way to avoid them is to e-file. Using tax preparation software is the best and simplest way to file a complete and accurate tax return. The software guides taxpayers through the process and does all the math. Combining direct deposit with electronic filing is the fastest way for a taxpayer to get their refund. With direct deposit, a refund goes directly into a taxpayer’s bank account. They don’t need to worry about a lost, stolen or undeliverable refund check.

2018 Tax Filing Season Opens with April 17 Deadline

IRS Announces 2018 Tax Filing Season Opens with April 17 Deadline; 155 Million Tax Returns Projected, 70 Percent Expect Refunds

Marking the beginning of the nation’s tax season, the Internal Revenue Service said today that it successfully started accepting and processing 2017 federal individual income tax returns. More than 155 million returns are expected to be filed this year.

People have until Tuesday, April 17, 2018, to file their 2017 returns and pay any taxes due. The filing tax deadline is later this year due to several factors. The usual April 15 deadline falls on Sunday this year, which would normally give taxpayers until at least the following Monday. However, Emancipation Day, a Washington, D.C., holiday, is observed on Monday, April 16, giving taxpayers nationwide an additional day to file. By law, Washington holidays impact tax deadlines for everyone in the same way federal holidays do. Taxpayers requesting an extension will have until Monday, Oct. 15, 2018, to file.

The IRS expects more than 70 percent of taxpayers to get tax refunds this year. Last year, nearly 112 million refunds were issued, with an average refund of $2,895.

“The IRS has a number of ways to help taxpayers this filing season, and we encourage people to look into the many options available,” said Acting IRS Commissioner David Kautter. “The nation’s tax professionals and software community work with the IRS and help make the tax filing process easier for Americans. Today’s filing season kick-off reflects many months of hard work by the nation’s tax community and IRS employees. And we also appreciate the time and attention taxpayers take as they prepare and file their taxes.”

Use e-File and Free File

The IRS expects about 90 percent of returns to be filed electronically. Choosing e-file and direct deposit remains the fastest and safest way to file an accurate income tax return and receive a refund.

The IRS Free File program, available at IRS.gov, gives eligible taxpayers a dozen options for brand-name products. Free File is a partnership with commercial partners offering free brand-name software to about 100 million individuals and families with incomes of $66,000 or less. About 70 percent of the nation’s taxpayers are eligible for IRS Free File. People who earned more than $66,000 may use Free File Fillable Forms, the electronic version of IRS paper forms.

Refunds in 2018: More than 90 Percent in Less than 21 days; EITC/ACTC Refunds Starting Feb. 27

The IRS issues more than nine out of 10 refunds in less than 21 days. However, it’s possible a tax return may require additional review and take longer. “Where’s My Refund?” has the most up to date information available about refunds. The tool is updated no more than once a day, so taxpayers don’t need to check more often.

The IRS also notes that refunds cannot be issued before mid-February for tax returns that claim the Earned Income Tax Credit or the Additional Child Tax Credit. This applies to the entire refund — even the portion not associated with the EITC and ACTC. While the IRS will process the EITC and ACTC returns when received, these refunds cannot be issued before mid-February. The IRS expects the earliest EITC/ACTC related refunds to be available in taxpayer bank accounts or on debit cards starting on Feb. 27, 2018, if they chose direct deposit and there are no other issues with the tax return.

“Where’s My Refund?” ‎on IRS.gov and the IRS2Go mobile app remain the best way to check the status of a refund. “Where’s My Refund?” will be updated with projected deposit dates for most early EITC and ACTC refund filers Feb. 17, so those filers will not see a refund date on “Where’s My Refund?” ‎or through their software packages until then. The IRS, tax preparers and tax software will not have additional information on refund dates, so these filers should not contact or call about refunds before the end of February.

This law change gives the IRS more time to detect and prevent fraud. Even with the EITC and ACTC refunds and the additional security safeguards, the IRS still expects to issue more than nine out of 10 refunds in less than 21 days. However, it’s possible a particular tax return may require additional review and take longer. Taxpayers are reminded that state tax agencies have their own refund processing timeframes that vary, and some states may make additional reviews to ensure their refunds are being issued properly. Even so, taxpayers and tax return preparers should file when they’re ready. For those who usually file early in the year and are ready to file a complete and accurate return, there is no need to wait to file.

Free Tax Help

Low- and moderate-income taxpayers can get help filing their tax return for free. More than 90,000 volunteers around the country can help people correctly complete their return.

To get this help, taxpayers can visit one of the more than 12,000 community-based tax help sites that participate in the Volunteer Income Tax Assistance and Tax Counseling for the Elderly programs. To find the nearest site, use the VITA/TCE Site Locator on IRS.gov or the IRS2Go mobile app.

Filing Assistance

No matter who prepares a federal tax return, by signing the return, the taxpayer becomes legally responsible for the accuracy of all information included. IRS.gov offers a number of tips about selecting a preparer and information about national tax professional groups.

The IRS urges all taxpayers to make sure they have all their year-end statements in hand before filing. This includes Forms W-2 from employers and Forms 1099 from banks and other payers. Doing so will help avoid refund delays and the need to file an amended return.

The 2018 Accounting year, is here!

The 2018 Accounting year, is  here!

With 2018 here, we’re here to update you with some tax changes, what to do for those bonus checks, and important information about your 940 and W-2 forms.

Payroll Tax Updates

Here’s the latest on what’s changing for 2018. We’ve updated our service to incorporate the items below, so you don’t have to worry.

  • Social Security wage base is changing—The 2018 Social Security wage base will increase to $128,400.
  • Additional Medicare Tax—Wages in excess of $200,000 will continue to be subject to an extra 0.9% Medicare tax in 2018.
  • Credit reduction states—If you pay wages in California, you will pay more in federal unemployment tax (FUTA) when you file your Form 940 for 2017. Visit the IRS website for more information.
  • New W-2 and 1099 filing deadlines—In an effort to combat fraud, The Protecting Americans from Tax Hikes (PATH) Act of 2015 was passed by Congress and signed by President Obama in December 2015. One key provision revises the filing deadline for W-2 forms and certain types of 1099 forms.

The deadline for both employee and agency copies is January 31, 2018.

For Your Employees: Import W-2 forms to TurboTax

As part of your payroll service, your employees’ W-2 form information is automatically made available for their use with TurboTax. Get more details about the feature and instructions for changing your preference option.

Running Your Final Payroll for 2017

If you use direct deposit to pay your employees, here are some things to keep in mind as the year comes to a close:

  • Direct deposit deadline for 2017—The last day to submit a direct deposit payroll for a pay date in 2017 is Wednesday, December 27, 2017 by 5 PM PT.
  • Bonus checks—You can pay your bonuses as a separate check or as a part of your employees’ regular paychecks.

Customer Care Corner

Here are more tips from our very own customer care team.

  • Looking for Form W-3?—Click Reports then type Tax and Wage Summary in the search field and hit Enter to review the information you would find on Form W-3. Form W-3 is not required when filing electronically using QuickBooks Online Payroll. Learn more about Form W-3.
  • Update your state unemployment insurance (SUI) rates—If you received a notice from your state agency telling you to update your rate starting January 1, 2018, click the gear icon in the upper-right to access your Settings. Choose Payroll Settings > Tax Setup and then State Tax Information. Then click Change or add new rate to enter the new rate and effective date. Click OK to save.

Need to file 1099-MISC Forms?

QuickBooks makes tax time easier than ever for small businesses with 1099 contractors.

  • Be ready for tax time—NEW! Invite contractors to electronically provide their current tax info (W-9) so you’re ready to file 1099-MISC forms at tax time. All you need to provide is their name and email – QuickBooks will do the rest.
  • Get your 1099 filing done right in less time—The Intuit 1099 E-File Service lets you file your 1099-MISC forms electronically with the IRS.

Coming in January! When you E-File through QuickBooks by January 27 at 5 PM (PT), we’ll deliver copies to your contractors by the IRS deadline so you don’t have to.

 

Don’t forget, the first IRS deadline is January 31, 2018.

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