Proposed Rulemaking for Misdirected Refunds Notice Issued by IRS

NSTPInternal Revenue Service (IRS)

Proposed Rulemaking for Misdirected Refunds Issued by IRS

Proposed Rulemaking for Misdirected Refunds Notice Issued by IRS The Internal Revenue Service and Treasury Department have issued a Notice of Proposed Rulemaking in the Federal Register regarding misdirected direct deposit refunds. These proposed regulations reflect changes to the law made by the Taxpayer First Act (TFA), which was signed into law on July 1, 2019. The TFA added section 6402(n) to the Code, which directed the IRS to establish procedures to allow taxpayers to report when a refund is not deposited into the taxpayer’s account, as well as establishing procedures for identification and recovery of the misdirected direct deposit refund. The proposed regulations are intended to increase awareness and provide guidance to affected taxpayers who have made a claim for refund, requested the refund be issued as a direct deposit, but did not receive a refund in the account designated on the claim for refund. It is important to note that a misdirected direct deposit refund is defined in the proposed regulations and in the IRM as “a refund or a portion of a refund was made by direct deposit to an account that is not the account designated on the taxpayer’s claim for refund.” This only applies to … Read More

Gig Economy Tax Center Opens Online

NSTPInternal Revenue Service (IRS)

Gig Economy Tax Center Opens Online

Gig Economy Tax Center Opens Online The Internal Revenue Service has created a new Gig Economy Tax Center on its website to help gig economy workers meet their tax obligations through more streamlined information. “The IRS developed this online center to help taxpayers in this emerging segment of the economy,” said IRS Commissioner Chuck Rettig. “Whether renting out a spare bedroom or providing car rides, we want people to understand the rules so they can stay compliant with their taxes and avoid surprises down the line.” The gig economy is also known as the sharing, on-demand or access economy. It usually includes businesses that operate an app or website to connect people to provide services to customers. While there are many types of gig economy businesses, ride-sharing and home rentals are two of the most popular. Educating gig economy workers about their tax obligations is vital because many don’t receive form W-2s, 1099s or other information returns for their work in the gig economy. However, income from these sources is generally taxable, regardless of whether workers receive information returns. This is true even if the work is full time, part-time or if the person is paid in cash. Workers may … Read More

IRS IP PIN Availability Expands

NSTPInternal Revenue Service (IRS)

IRS IP PIN Availability Expands

IRS IP PIN Availability Expands When the IRS begins the 2020 tax filing season, taxpayers in selected locations will be eligible to opt into the online Identity Protection PIN program.  The IP PIN is a 6-digit number that adds another layer of protection for taxpayers’ Social Security numbers and helps protect against tax-related identity theft.  Taxpayers will be eligible for this voluntary program if they filed a federal tax return last year from Arizona, California, Colorado, Connecticut, Delaware, District of Columbia, Florida, Georgia, Illinois, Maryland, Michigan, Nevada, New Jersey, New Mexico, New York, North Carolina, Pennsylvania, Rhode Island, Texas and Washington.  The IRS has issued IP PINs to confirmed identity theft victims since 2011. In recent years, the IRS has been expanding the program to taxpayers who are not confirmed identity theft victims but who may want this additional protection.  Taxpayers opting into the IP PIN program must use the online Get an IP PIN tool at IRS.gov/IPPIN.  The IRS has created a new publication – Publication 5367, Identity Protection PIN Opt-In Program for Taxpayers – to help taxpayers understand the required steps. Please share with clients who are interested in this program. The publication is in English and Spanish. It can … Read More

Avoid Tax-Time Surprise by Making a Payment Now Says IRS

NSTPInternal Revenue Service (IRS)

Avoid Tax-Time Surprise by Making a Tax Payment Now Says IRS

Avoid Tax-Time Surprise by Making a Payment Now Says IRS Taxpayers who paid too little tax during 2019 can still avoid a tax-time surprise by making a quarterly estimated tax payment now, directly to the Internal Revenue Service. The deadline for making a payment for the fourth quarter of 2019 is Wednesday, January 15, 2020. Income taxes are pay-as-you-go. This means that by law, taxpayers are required to pay most of their tax during the year as income is received. There are two ways to do this: Withholding from paychecks, pension payments, Social Security benefits or certain other government payments. This is how most people pay most of their tax. Making quarterly estimated tax payments throughout the year. Self-employed people and investors, among others, often pay tax this way. Either method can help avoid a surprise tax bill at tax time and the accompanying penalty that often applies. If a taxpayer failed to make required quarterly estimated tax payments earlier in the year, making a payment to cover these missed payments, as soon as possible, will usually lessen and may even eliminate any possible penalty. The IRS recommends that everyone check their possible tax liability by using the IRS Tax … Read More

New Taxpayer Free File Agreement to Strengthen Program, Help Taxpayers

NSTPFree File, Internal Revenue Service (IRS)

New Free File Agreement for Taxpayers

New Taxpayer Free File Agreement to Strengthen Program, Help Taxpayers The Internal Revenue Service has announced today an agreement with Free File, Inc. (FFI) designed to bring more clarity for taxpayers choosing to use free online software during the 2020 filing season. The agreement reached will help make the Free File program more taxpayer-friendly while strengthening consumer protections in several key areas. “This updated agreement is part of a larger effort by the IRS to help taxpayers meet their tax obligations,” said IRS Commissioner Chuck Rettig. “It continues to show the partnership we enjoy with the Free File partners and the commitment we both share in helping taxpayers since the program’s creation 18 years ago. The improved process will make Free File stronger and give taxpayers another reason to consider this valuable software option.” “The IRS and FFI will also continue to work together to identify and explore ways to better help low- to moderate-income taxpayers and to pursue meaningful opportunities to enhance taxpayer awareness and use of the Free File Program beyond the 2020 filing season,” Rettig added.   Each year, Free File partners, acting through FFI, offer their software free to eligible taxpayers. Any taxpayer earning $69,000 or … Read More

2020 Standard Mileage Rates Issued by IRS

NSTPInternal Revenue Service (IRS)

2020 Standard Mileage Rates Issued by IRS

2020 Standard Mileage Rates Issued by IRS The Internal Revenue Service has issued the 2020 optional standard mileage rates (PDF) used to calculate the deductible costs of operating an automobile for business, charitable, medical or moving purposes. Beginning on January 1, 2020, the standard mileage rates for the use of a car (also vans, pickups or panel trucks) will be: 57.5 cents per mile driven for business use, down one half of a cent from the rate for 2019, 17 cents per mile driven for medical or moving purposes, down three cents from the rate for 2019, and 14 cents per mile driven in service of charitable organizations. The business mileage rate decreased one half of a cent for business travel driven and three cents for medical and certain moving expense from the rates for 2019. The charitable rate is set by statute and remains unchanged. It is important to note that under the Tax Cuts and Jobs Act, taxpayers cannot claim a miscellaneous itemized deduction for unreimbursed employee travel expenses. Taxpayers also cannot claim a deduction for moving expenses, except members of the Armed Forces on active duty moving under orders to a permanent change of station. The standard mileage rate … Read More