If you've been champing at the bit to file your 2013 federal income tax return, feel free to do so.
The Internal Revenue Service (IRS) has opened the filing season by highlighting a growing array of online services and encouraging taxpayers to check out a variety of tax benefits, such as the often-overlooked Earned Income Tax Credit.
You have until Tuesday, April 15, 2014, to file your 2013 tax returns and pay any tax due. More than 148 million individual tax returns are expected to be filed this year, with more than four out of five now filed electronically.
About three out of four filers typically get refunds because they've had more withheld than they need to, and more than 90% of these refunds are received in less than 21 days, according to the IRS. Last year, taxpayers received an average refund of $2,744.
E-file, when combined with direct deposit, is the fastest way to get a refund, with more than 75% of refund recipients choosing direct deposit.
“Tens of millions of people will file their taxes in the next few weeks, and we encourage taxpayers to visit IRS.gov as the best place to get quick help,” said IRS Commissioner John Koskinen. “We continue to add features and make it more user-friendly to help taxpayers. People can get everything from answers to tax questions about preparing their tax return to checking the status of their refund after they file.”
The IRS began accepting and processing individual tax returns on January 31 after updating tax forms and completing programming and testing of its systems. The agency says it also has updated and strengthened its systems to help protect against refund fraud and identity theft. This annual updating process saw delays in October following the 16-day federal government shutdown.
Although an estimated four out of five eligible workers and families get the Earned Income Tax Credit (EITC), which helps working families with low and moderate incomes, one in five miss out on it. That’s because either they don’t claim it when filing or they don’t file a tax return at all because their income is below the filing threshold. One-third of the population eligible for EITC shifts each year as their personal circumstances, such as work status or family situation, change and can affect eligibility.
“We urge people to look into EITC. Many people don’t realize they are eligible and simply overlook this credit,” Koskinen said. “There are easy ways to find out more about this credit, either by visiting IRS.gov, or using Free File or a software package. The IRS is working hard to educate people about EITC while also putting in place processes that identify and prevent improper payments.”
Online tools available
Aimed at individuals and families who made $51,567 or less last year, the EITC varies by income, family size and filing status. People can see if they qualify by answering a few questions using the EITC Assistant, a special online tool. Eligible taxpayers can also use another helpful online resource, the VITA Site Locator tool to locate one of nearly 13,000 community-based volunteer tax sites consisting of over 90,000 volunteers that can help them file their return for free.
The EITC Assistant and VITA Site Locator are just two of a growing array of online and automated IRS services that can help taxpayers get the information they need to file their returns and get their refunds quickly.
Tele-Tax, for example, helps taxpayers see if they qualify for various tax benefits, such as the Child Tax Credit and Additional Child Tax Credit for eligible families, the American Opportunity Tax Credit for parents and college students, the saver’s credit for low-and moderate-income workers saving for retirement and energy credits for homeowners making qualifying energy-saving home improvements.
The automated IRS services can also help home-based businesses check out the new simplified option for claiming the home office deduction, a straightforward computation that allows eligible taxpayers to claim $5 per square foot, up to a maximum of $1,500, instead of filling out a 43-line form (Form 8829) with often complex calculations.
When taxpayers are ready to fill out and file their returns, another online option enables anyone to e-file their returns for free. Free File offers two free electronic filing options: brand-name tax software or online Fillable Forms. Taxpayers who make $58,000 or less can choose free options from 14 commercial software providers. There’s no income limit for the second option, Free File Fillable Forms, the electronic version of IRS paper forms, which is best suited to people who are comfortable preparing their own tax return.
Even after taxpayers file, there are more online tools that can provide them with valuable assistance long after tax season ends. One of the most popular is Where’s My Refund?, a tool that enables taxpayers to track the status of their refund. Initial information will normally be available within 24 hours after the IRS receives the taxpayer’s e-filed return or four weeks after the taxpayer mails a paper return to the IRS. The system updates every 24 hours, usually overnight, so there’s no need to check more often.
For taxpayers whose concern isn’t a refund, but rather, a tax bill they can’t pay, the Online Payment Agreement tool can help them determine whether they qualify for an installment agreement with the IRS. And those whose tax obligation is even more serious, the Offer in Compromise Pre-Qualifier can help them determine if they qualify for an offer in compromise, an agreement with the IRS that settles their tax liability for less than the full amount owed.
Another useful year-round tool, the IRS Withholding Calculator, helps employees make sure the amount of income tax taken out of their pay is neither too high nor too low. This tool can be particularly useful to taxpayers who, after filling out their tax returns, find that the refund or balance due was higher than expected.
Other help available
The IRS also offers more than 100 short instructional videos, tax tips and other useful resources year-round through a variety of social media platforms. They include:
YouTube, available in English, Spanish, and American Sign Language.
Several twitter feeds in English and Spanish at @IRSnews, @IRSenEspanol and @IRStaxpros.
Tumblr at www.internalrevenueservice.tumblr.com.
The IRS uses social media tools only to share information with the public, not to answer personal tax or account questions. And the agency reminds taxpayers to never post confidential information, such as a Social Security number, on social media sites.
If you've been champing at the bit to file your 2013 federal income tax return, feel free to do so. The Internal Revenue Service (IRS) has opened the fili...