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February 1 is the deadline for employers to issue and file wage statements

February 1 is the deadline for employers to issue and file wage statements

Employers must file Form W-2 and other wage statements by Monday, February 1, 2021. This is also the date Form W-2s are due to employees.

By law, employers are required to file copies of their Form W-2Wage and Tax Statement, and Form W-3Transmittal of Wage and Tax Statements, with the Social Security Administration by January 31. However, since January 31 falls on a Sunday in 2021, the deadline is the next business day, Monday, February 1.

Form 1099-MISCMiscellaneous Income and Form 1099-NECNonemployee Compensation, are also due to recipients on February 1, 2021, with some exceptions. Other due dates related to Form 1099 are listed in the instructions for these forms.

Timely filing helps prevent fraud.
Filing wage statements on time and without errors is beneficial to employers and the IRS. The employer avoids penalties, and the IRS has time to verify income taxpayers report on their tax returns, which helps prevent fraud.

Employers should plan and prepare early.
Good preparation now can help employers avoid problems later. For instance, employers can start by verifying or updating employee information, such as:
•  Names
•  Addresses
•  Social Security numbers
•  Individual Taxpayer Identification Numbers

Employers should be sure their account information is current and active with the Social Security Administration as soon as possible. Lastly, employers should order paper Form W-2s, if needed.

Automatic extensions of time to file Form W-2s are not available. The IRS will only grant extensions for very specific reasons. For details, employers should read the instructions for Form 8809Application for Extension of Time to File Information Returns.

 

IRS extends Economic Impact Payment deadline to Nov. 21 to help non-filers

 

IRS extends Economic Impact Payment deadline to Nov. 21 to help non-filers

WASHINGTON – The Internal Revenue Service announced today that the deadline to register for an Economic Impact Payment (EIP) is now Nov. 21, 2020. This new date will provide an additional five weeks beyond the original deadline.

The IRS urges people who don’t typically file a tax return – and haven’t received an Economic Impact Payment – to register as quickly as possible using the Non-Filers: Enter Info Here tool on IRS.gov. The tool will not be available after Nov. 21.

“We took this step to provide more time for those who have not yet received a payment to register to get their money, including those in low-income and underserved communities,” said IRS Commissioner Chuck Rettig. “The IRS is deeply involved in processing and programming that overlaps filing seasons. Any further extension beyond November would adversely impact our work on the 2020 and 2021 filing seasons. The Non-filers portal has been available since the spring and has been used successfully by many millions of Americans.”

Special note: This additional time into November is solely for those who have not received their EIP and don’t normally file a tax return. For taxpayers who requested an extension of time to file their 2019 tax return, that deadline date remains Oct. 15.

To support the ongoing EIP effort, many partner groups have been working with the IRS, helping translate and making available in 35 languages IRS information and resources on Economic Impact Payments.

To help spread the word, the IRS sent nearly 9 million letters in September to people who may be eligible for the $1,200 Economic Impact Payments but don’t normally file a tax return. This push encourages people to use the Non-Filers tool on IRS.gov.

“Time is running out for those who don’t normally file a tax return to get their payments,” Rettig added. “Registration is quick and easy, and we urge everyone to share this information to reach as many people before the deadline.”

While most eligible U.S. taxpayers have automatically received their Economic Impact Payment, others who don’t have a filing obligation need to use the Non-Filers tool to register with the IRS to get their money. Typically, this includes people who receive little or no income.

The Non-Filers tool is secure and is based on Free File Fillable Forms, part of the Free File Alliance’s offering of free products on IRS.gov.

The Non-Filers tool is designed for people with incomes typically below $24,400 for married couples, and $12,200 for singles who could not be claimed as a dependent by someone else. This includes couples and individuals who are experiencing homelessness.

Anyone using the Non-Filers tool can speed the arrival of their payment by choosing to receive it by direct deposit. Those not choosing this option will get a check.

Beginning two weeks after they register, people can track the status of their payment using the Get My Payment tool, available only on IRS.gov.

IRS now sending $500 payments to taxpayers who did not originally receive the correct amount of their Stimulus Payment

If you get $500 from Uncle Sam in the next week or so, don’t freak out. It’s real if you used one of the Internal Revenue Service’s online coronavirus registration tools and didn’t originally get all the relief you were due.

The tax agency is sending the money to those who previously were denied the $500 per child economic impact payment (EIP) amount created by the Coronavirus Aid, Relief and Economic Security (CARES) Act.

The problem with the shorted amount wasn’t with these individuals’ or their minor children’s’ eligibility.

It was due to a glitch in the IRS system set up to deliver the payments and the timing of when they made requests for the stimulus money.

Problem with non-filers solution: The original stimulus payouts of $1,200 per taxpayer were based on a person’s 2019 or 2018 tax year federal income tax returns. Where filers claimed dependents, children younger than 17 usually meant an additional $500.

Since some eligible EIP recipients weren’t required to file returns for either tax year, in early April the IRS established an online non-filers tool that allowed these individuals to register for the payments.

Sometimes, though, good intentions go awry, especially when you’re trying to get things done in a hurry. That happened for some folks who had legitimate minor dependents and who used the IRS’ non-filer tool.

Early EIP request issues: The IRS says that eligible individuals who used the non-filer tool before May 17 and claimed at least one qualifying child did not receive the qualifying child portion.

The reason was an error in the system that was corrected on that May date.

So now the IRS is sending out the appropriate $500 dependent payments to those who used the online registration tool before May 17.

Usual delivery methods: The corrected amount of dependent EIP money will be delivered as direct deposit to those who included that information when they used the non-filer online option.

The IRS started depositing those payments on Aug. 5, so in most instances, that money should have showed up in bank accounts by now.

If you are due an extra $500 (or more, depending on the number of qualifying children) and don’t have a bank account, the IRS is sending your EIP via the U.S. Postal Service as a paper check or a debit card.

Checks and cards were scheduled to go out on Friday, Aug. 7, so look for them to show up in your snail mail box this week.

Payment follow-up, record keeping: Regardless of how this corrected dependent payment amount is issued, recipients also will get another mailed notice letting them know the additional $500 EIP was issued.

As with the original letter from the White House, it’s an official tax document that you should keep with your other tax records.

And if you were due this previously-denied dependent EIP and haven’t or don’t soon receive it, you can use the IRS’ Get My Payment online search to check its status.

You also might find these items of interest:

Non-Filers tool-Economic Impact Payment; low-income, homeless qualify

New Spanish language version unveiled

 

Who can get more Economic Impact Payment money for children
IR-2020-83, April 28, 2020
WASHINGTON – The Internal Revenue Service today reminds low-income Americans to use the free, online tool Non-Filers: Enter Payment Info to quickly and easily register to receive their Economic Impact Payment.
The IRS has recently released a new Spanish language version of the tool to help even more Americans get their money quickly and easily.
“The IRS is working hard to find new ways for people who don’t have a filing requirement to receive their Economic Impact Payment,” said IRS Commissioner Chuck Rettig. “The Non-Filers tool is an easy way people can register for these payments. I appreciate the work of the Free File Alliance to quickly develop a Spanish-language version of this tool to reach additional people. This is part of a wider effort to reach underserved communities.”
The Non-Filers tool is designed for people with incomes typically below $24,400 for married couples or less than $12,200 for single people. This includes couples and individuals who are homeless. People can qualify, even if they do not work. Anyone claimed as a dependent by another taxpayer is not eligible.
Usually, married couples qualify to receive a $2,400 payment while others normally qualify to get $1,200. People with dependents under 17 can get up to an additional $500 for each child.
Just like people who file returns every year, those who do not have a filing requirement also generally qualify for an Economic Impact Payment. The IRS doesn’t know who many of these people are since they normally don’t file. So, the only way to get the Economic Impact Payment is to register with the IRS.
Here are some questions and answers on the Non-filers tool:
How do I use the Non-Filers: Enter Payment Info tool?
For those who don’t normally file a tax return, the process is simple and only takes a few minutes. First, visit IRS.gov, and look for “Non-Filers: Enter Payment Info Here.” Then provide basic information including Social Security number, name, address, and dependents.
The IRS will use this information to confirm eligibility, calculate and send an Economic Impact Payment. No tax will be due as a result of receiving the payment. Entering bank or financial account information will allow the IRS to quickly deposit the payment directly in a savings or checking account. Otherwise, the payment will be mailed, which will take longer to receive than by direct deposit.
Non-Filers: Enter Payment Info is secure, and the information entered will be safe. The tool is based on Free File Fillable Forms, part of the Free File Alliance’s offerings of free products on IRS.gov.
Who should use the Non-Filers tool?
This new tool is designed for people who did not file a tax return for 2018 or 2019 and are not required to do so under the law. Usually, this means couples with incomes below $24,400 and singles with incomes below $12,200 in 2019.
In addition, the Non-Filers tool can also help families receiving certain government benefits get additional payment amounts, based on their children. These include those receiving Supplemental Security Income (SSI) and Veterans Affairs beneficiaries who did not file returns for 2018 or 2019. These recipients need to make the updates for the children in the tool by May 5.
By taking this step, they will still be eligible to receive the separate payment of $500 per qualifying child. See the news release on IRS.gov for full details.
Who should NOT use the tool?
Anyone who already filed either a 2018 or 2019 return does not qualify to use this tool. Similarly, anyone who needs to file either a 2018 or 2019 return should not use this tool, but instead they should file their tax returns. This includes anyone who files a return to claim various tax benefits, such as the Earned Income Tax Credit for low-and moderate-income workers and working families.
The IRS also has seen instances where people required to file a Form 1040 for 2019 are trying to use the Non-Filers tool. The IRS urges people with a filing requirement to avoid complications later with the IRS, and file properly without using the Non-Filer tool.
Students and others who file a return only to receive a refund of withheld taxes should also not use this tool. In addition, students and others claimed as dependents on someone else’s tax return don’t qualify for an Economic Impact Payment and are not eligible to use the Non-Filers tool.
For more Information on Economic Impact Payments, including answers to frequently-asked questions and other resources, visit IRS.gov/coronavirus.

 

Millions of Americans have already received their Economic Impact Payments as the IRS continues to automatically send payments to more individuals. Eligible taxpayers who filed tax returns for either 2019 or 2018 will automatically receive their payment. The IRS will calculate the amount based on the income, filing status and dependent information on their most recently filed tax return.
While people who receive Supplemental Security Income and Veterans Affairs disability compensation and pension benefits will receive up to $1,200 automatically, some people in this group with children under 17 can receive up to an additional $500 for each qualifying child and need to act by May 5 to get it.
People in this group who have qualifying children under age 17 can claim the additional $500 per qualifying child and will need to provide their child’s information to the IRS using the Non-Filers: Enter Payment Info Here tool before May 5. Individuals who are married must also provide additional information using the Non-Filer tool to claim the full $2,400 payment if their spouse didn’t receive SSA, SSDI, RRB, SSI or VA benefits in 2019 and didn’t have to file a tax return in the last two years.
A qualifying child is someone who:
  • Is the child, stepchild, eligible foster child, sibling, half sibling, step sibling or a descendant of the individual. A descendant includes children like a grandchild, niece or nephew.
  • Can be claimed as a dependent on the taxpayer’s tax return. For those who don’t usually file a tax return, include the child’s information in the Non-Filers: Enter Your Payment Info Here tool before May 5.
  • Was younger than 17 at the end of the 2019 tax year.
  • Is a U.S. citizen, U.S. national, or U.S. resident alien.
  • Has a valid Social Security number or an adoption taxpayer identification number.
Some people have older dependents. This includes people like an individual’s parent or a college student. Here are a couple things to know about dependents 17 or older:
  • Individuals with dependents 17 and older won’t get more money for those dependents.
  • The person claimed as a dependent on another person’s tax return isn’t eligible for the $1,200 Economic Impact Payment.
In addition to those receiving SSI and VA recipients who receive Compensation and Pension (C&P) benefit, payments are also automatic for people who don’t normally file a tax return but receive certain payments. These payments are:
  • Social Security benefits for retirement,
  • Social Security Disability insurance
  • Survivor benefits
  • Railroad Retirement benefits
More information:
Share this tip on social media — #IRSTaxTip: Who can get more Economic Impact Payment money for children. https://go.usa.gov/

Economic Impact Payment – Get My Payment

To serve you better, #IRS has enhanced the “Get My Payment” online tool. If you have not yet received an Economic Impact Payment, check this resource again: www.irs.gov/getmypayment #COVIDreliefIRS

#IRS announces significant enhancements to the “Get My Payment” tool to deliver an improved and smoother experience for Americans eligible for an Economic Impact Payment. www.irs.gov/getmypayment #COVIDreliefIRS

The #IRS “Get My Payment” online tool has been enhanced to help Americans eligible to receive Economic Impact Payments. www.irs.gov/getmypayment #COVIDreliefIRS

Improvements to the #IRS “Get My Payment” tool continue. If you don’t have a date for your Economic Impact Payment, visit the tool again for the latest information. www.irs.gov/getmypayment #COVIDreliefIRS

#IRS continues to improve the “Get My Payment” tool. If you haven’t received a date yet for your Economic Impact Payment, be sure to visit www.irs.gov/getmypayment #COVIDreliefIRS

Check back in with the “Get My Payment” tool – #IRS has made several enhancements to help many more people eligible for Economic Impact Payments. www.irs.gov/getmypayment #COVIDreliefIRS

May 5 Deadline; SSI recipients

SSI benefit recipients who don’t normally file a tax return and have eligible children must act by May 5 to add $500 to their Economic Impact Payments. Register with the #IRS Non-Filers’ tool: www.irs.gov/nonfilereip #COVIDreliefIRS – Spread the word on this ‘Plus $500 Push’

SSI and VA benefit recipients who don’t normally file a tax return and have children must act soon to quickly receive the full amount of their Economic Impact Payments automatically from #IRS. The deadline is May 5: www.irs.gov/nonfilereip #COVIDreliefIRS

SSI benefit recipients: If you didn’t file taxes for 2018 or 2019 and have children, act now to get the full amount of your Economic Impact Payment automatically from #IRS. The deadline is May 5: www.irs.gov/nonfilereip #COVIDreliefIRS – Share this ‘Plus $500 Push’

ALERT: If you’re an SSI benefit recipient with dependent children and didn’t file taxes for 2018 or 2019, register by May 5 to receive the full amount of your Economic Impact Payment from #IRS: www.irs.gov/nonfilereip #COVIDreliefIRS

If you’re a recipient of SSI benefits with children but don’t normally file taxes, #IRS needs your info by May 5 to issue your full Economic Impact Payment automatically. Sign up at: www.irs.gov/nonfilereip Help spread the word on the ‘Plus $500 Push.’ #COVIDreliefIRS

National Enrolled Agent Week is February 2-8, 2020

Please join me in congratulating the National Association of Enrolled Agents, Florida Society of Enrolled Agents and the Suncoast Chapter of Enrolled Agents.  The first week of February 2020 is now officially known as National Enrolled Agent Week.

Thank you Mayor Jane Castor for this honor and for displaying it on the City of Tampa Website!!

IRS updates per diem guidance for business travelers and their employees

IRS Statements and Announcements
IR-2019-190, November 26, 2019
WASHINGTON — The Internal Revenue Service today issued guidance for business travelers, updated to include changes resulting from the Tax Cuts and Jobs Act (TCJA).
Revenue Procedure 2019-48 (PDF), posted today on IRS.gov, updates the rules for using per diem rates to substantiate the amount of ordinary and necessary business expenses paid or incurred while traveling away from home. Taxpayers are not required to use a method described in this revenue procedure and may instead substantiate actual allowable expenses provided they maintain adequate records.
Although TCJA suspended the miscellaneous itemized deduction that employees could take for non-reimbursed business expenses, self-employed individuals and certain employees, such as Armed Forces reservists, fee-basis state or local government officials, eligible educators, and qualified performing artists, that deduct unreimbursed expenses for travel away from home may still use per diem rates for meals and incidental expenses, or incidental expenses only.
The revenue procedure makes clear that TCJA amended prior rules to disallow a deduction for expenses for entertainment, amusement, or recreation paid or incurred after December 31, 2017. Otherwise allowable meal expenses remain deductible if the food and beverages are purchased separately from the entertainment, or if the cost of the food and beverages is stated separately from the cost of the entertainment.
The IRS annually issues guidance providing updated per diem rates; Notice 2019-55 (PDF) provides the rates that have been in effect since October 1, 2019.

U.S. Treasury
Treasury Inspector General for Tax Administration
USA.gov

 

 

Final Regulations confirm: Making large gifts now won’t harm estates after 2025

WASHINGTON — The Treasury Department and the Internal Revenue Service today issued final regulations confirming that individuals taking advantage of the increased gift and estate tax exclusion amounts in effect from 2018 to 2025 will not be adversely impacted after 2025 when the exclusion amount is scheduled to drop to pre-2018 levels.
Treasury Decision 9884, available today in the Federal Register, implements changes made by the Tax Cuts and Jobs Act (TCJA), the tax reform legislation enacted in December 2017. Though the final regulations largely adopt the proposed regulations published last November, they also include clarifying technical language addressing concerns raised in several public comments as well as four examples which, among other things, illustrate the impact of inflation adjustments. As a result, individuals planning to make large gifts between 2018 and 2025 can do so without concern that they will lose the tax benefit of the higher exclusion level once it decreases after 2025.
In general, gift and estate taxes are calculated, using a unified rate schedule, on taxable transfers of money, property and other assets. Any tax due is determined after applying a credit – formerly known as the unified credit – based on an applicable exclusion amount.
The applicable exclusion amount is the sum of the basic exclusion amount (BEA) established in the statute, and other elements, if applicable, described in the final regulations. The credit is first used during life to offset gift tax and any remaining credit is available to reduce or eliminate estate tax.
The TCJA temporarily increased the BEA from $5 million to $10 million for tax years 2018 through 2025, with both dollar amounts adjusted for inflation. For 2019, the inflation-adjusted BEA is $11.4 million. In 2026, the BEA will revert to the 2017 level of $5 million as adjusted for inflation.
To address concerns that an estate tax could apply to gifts exempt from gift tax by the increased BEA, the final regulations provide a special rule that allows the estate to compute its estate tax credit using the higher of the BEA applicable to gifts made during life or the BEA applicable on the date of death.
More information about this and other TCJA provisions can be found on the Tax Reform page on IRS.gov.

Information provided by:
U.S. Treasury
Treasury Inspector General for Tax Administration
USA.gov