Taxes and IRS News, Regulations, and Scams

Finance News

Major IRS 'Payment Due' glitch discovered

Agency is on the situation and offers instructions for anyone who received this notice.

Featured Finance News photo

If you received a notice of a “balance due” from the Internal Revenue Service (IRS) and you’re sure you paid everything you owe, you can probably breathe a little easier.

ConsumerAffairs has learned from the tax agency that an unknown number of taxpayers received the notice because of a system “glitch” and if they made all their payments on time, they owe nothing.

A ConsumerAffairs employee received one of these “amount due” notices on Monday, even though they had alread...

Read article
Featured Finance News photo

Latest Articles

  1. Feds are investigating firms that use personal data to set prices
  2. Here's how prices of key goods and services changed in the first half of 2024
  3. Mortgage rates fell for another week
  4. Americans mostly unprepared for 'the great wealth transfer,' study finds
  5. Price of gold hits new record high

Not sure how to choose?

Get expert buying tips about Taxes and IRS News, Regulations, and Scams delivered to your inbox.

    By entering your email, you agree to sign up for consumer news, tips and giveaways from ConsumerAffairs. Unsubscribe at any time.

    Thanks for subscribing.

    You have successfully subscribed to our newsletter! Enjoy reading our tips and recommendations.

    Recent Articles

    • Newest
    • Oldest
    Article Image

    Withholding -- too much vs. too little

    Some easy steps for having the right amount taken out

    When tax time comes every April, do you find yourself celebrating because you're getting a refund or griping because you owe taxes?

    There's a way to avoid both.

    The Internal Revenue Service (IRS) advises you to check your tax withholding from time to time as there are a number of factors that could determine whether you get money back or have to send more in.

    It's important to remember that when you get a refund, it's YOUR money you are getting back, not the government's. By withholding too much, you're giving Uncle Sam an interest-free loan. This is money you could invest and put to work for you. Whether you would or not is a topic for a separate discussion.

    In any event, when you have the correct amount taken out, you get closer to having a zero balance when you file your return -- no taxes owed, no refund.

    What to do

    In many cases, a new Form W-4, Employee’s Withholding Allowance Certificate, is all you need to make an adjustment. Just submit it to your employer, and the employer will use it to figure out how much federal income tax to withheld from your pay.

    The IRS offers several online resources to help you bring taxes paid closer to what you owe. They include:

    Self-employed taxpayers, including those involved in the sharing economy, can use the Form 1040-ES worksheet to figure their estimated tax payments.

    If they also work for an employer, they can often forgo making these quarterly payments by instead having more tax taken out of their pay.

    When tax time comes every April, do you find yourself celebrating because you're getting a refund or griping because you owe taxes?There's a way to avo...

    Article Image

    The IRS is hiring debt collectors

    Raises possibility that scammers will try to impersonate them

    If you owe the Internal Revenue Service (IRS) back taxes and despite repeated reminders, still haven't gotten around to writing a check, expect a call from a debt collector.

    The IRS has started sending letters to what it calls “a relatively small group” of taxpayers who are severely delinquent. The letters will explain that the IRS has turned the account over to one of four private debt collection agencies.

    The IRS says the delinquent accounts are old and multiple attempts have been made in the past to collect them. Still, this effort could pose dangers for a wide range of consumers if scammers seize on this development.

    “The IRS is taking steps throughout this effort to ensure that the private collection firms work responsibly and respect taxpayer rights,” said IRS Commissioner John Koskinen. “The IRS also urges taxpayers to be on the lookout for scammers who might use this program as a cover to trick people. In reality, those taxpayers whose accounts are assigned as part of the private collection effort know they have a tax debt.”

    How to avoid a scam

    That last part is key. Koskinen says the people who will receive calls from these legitimate debt collectors are well aware that they have an unpaid tax debt. They have dealt with IRS personnel on this issue in the past.

    That means if you are unaware that you owe the IRS money and get a call from someone claiming to be a debt collector, the IRS says you are being targeted by a scammer and should hang up.

    Okay, this bears repeating. If you are unaware that you owe back taxes and someone calls you claiming you do, you don't. It's that simple.

    Letter from the IRS

    The collection program began this week and the people who owe the money should have received a letter from the IRS, telling them to expect a call. If you didn't get one of these letters, you don't owe any money.

    Here's another clue – the IRS says people who owe money will always be contacted by the tax agency first, before they are ever contacted by a debt collector. So if the IRS hasn't contacted you, neither should a debt collector.

    The IRS reiterates that taxpayers should be vigilant for scammers posing as private collection firms. The IRS said it will also be watching for these schemes as the collection program begins.

    If you owe the Internal Revenue Service (IRS) back taxes and despite repeated reminders, still haven't gotten around to writing a check, expect a call from...

    Article Image

    Tax records: What to keep and for how long

    No need to be a paperwork pack-rat

    What must I keep? What can I toss?

    Questions about how long to keep tax returns and other documents face many taxpayers at this time of year.

    As a general rule, the Internal Revenue Service (IRS) recommends holding on to copies of tax returns and supporting documents at least three years. However, there are some that should be kept up to seven years in case a taxpayer needs to file an amended return or if questions arise. That includes records relating to real estate after you've disposed of the property.

    Even though you don't need to send them to IRS as proof of coverage, it's a good idea to keep health care information statements should with other tax records.

    These include records of any employer-provided coverage, premiums paid, advance payments of the premium tax credit received, and type of coverage. Three years after you file your tax return is the recommended time for keeping these records.

    How to store

    Whether your tax records are paper or electronic, the IRS says you should be sure they're kept safe and secure -- especially any documents bearing Social Security numbers. It's also a good idea to scan paper tax and financial records into a format that can be encrypted and stored securely on a flash drive, CD or DVD with photos or videos of valuables.

    Records to be saved include those that support the income, deductions and credits claimed on returns. You'll need them if the IRS asks questions about a tax return or to file an amended return.

    Cleaning house

    When records are no longer needed for tax purposes, make sure they are destroyed properly to prevent the information from falling into the hands of identity thieves.

    If disposing of an old computer, tablet, mobile phone, or back-up hard drive, keep in mind it includes files and personal data. Removing this information may require special disk utility software.

    What must I keep? What can I toss?What must I keep? What can I toss?Questions about how long to keep tax returns and other documents face many...