Tag Archives: Child Tax Credit

Tax Reform is Confusing Part 2

Do you struggle feeling Tax Reform is confusing?

Yes, tax reform is confusing. In part 2 we hope to shed light on other areas of tax reform changes. As mentioned last week, we decided to put together a side-by side comparison of the old and new law. At the end of Part 1’s blog post, is an infographic to help you maneuver all the details behind Tax Reform. Below we will break down Part 2 of this very long infographic for an easier understanding. Let’s go! Continue reading

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Tax Reform and Your Taxes

Well, the Tax Cuts and Jobs Act (H.R. 1) has passed, mainly starting in 2018. Are you confused by tax reform and your taxes, and how this new law will impact you? You’re not alone. As has become the norm for Congress, it played brinksmanship and waited to almost the end of the year, in the midst of the holidays, to pass this very extensive tax bill, providing little time for anyone to plan for 2018.

So that you have an idea about how these changes might affect individual taxpayers like yourself, we have put together some of the key points of the new law. As a suggestion, pull out your 2016 federal return and follow along to get a better understanding of these changes. Continue reading

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IRS Takes Action on Tax Credits

Why does the IRS need to take action on tax credits?

The IRS takes action on tax credits for the 2016 tax returns during the 2017 tax season for a good reason. Tax credits and tax fraud costs the government billions of tax dollars a year. The IRS is clamping down on tax credits due to these costs. In an effort to rein in tax fraud, some new laws took effect in 2016. These laws clamp down on individuals who file a fraudulent claim on the American Opportunity Tax Credit (AOTC), the Child Tax Credit (CTC), or the Earned Income Tax Credit (EITC).

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Refund Statute Has Expired, Did You File?

2015_05_06 Refund Statute3Regarding the IRS Refund Statute of Limitations, we have good news and bad news. The bad news is, if you have not yet filed your 2011 federal tax return time has run out, meaning the refund you expected is not going to happen! Now that does not mean you do not have to file you 2011 federal return, because you do. However, there is good news about the refund statute of limitations. You have until April 15, 2016 to file your 2012 tax return.

IRS Projections – Refund Statute

The IRS estimates that there are more than 1.1 million taxpayers who have not filed their 2012 tax returns. There is approximately $1.1 billion dollars of unclaimed refunds available for those taxpayers. If you fall in this category, you need to act within the year because the return must be filed by April 15, 2016. Otherwise, the money becomes the property of the U.S. Treasury.

What if I failed to file a return?

By failing to file a return, people stand to lose more than a refund of taxes withheld or paid during 2012. Many low and moderate income workers may not have claimed the Earned Income Tax Credit (EITC). The EITC helps individuals and families with incomes below certain thresholds. For unmarried individuals in 2011 that was $40,964 for those with two or more children. For people with one child it was $36,052. For those with no children it was $13,660. Each amount is $5,080 more for married joint filers. In addition, parents eligible to claim the refundable portion of the child tax credit will forfeit that benefit if they do not file a return.

When filing a 2012 return, the law requires that the return be properly addressed, mailed and postmarked by the April 15, 2016. And here is more good news, there is no penalty for filing a late return qualifying for a refund.

As a reminder, taxpayers seeking a 2012 refund should know that their checks will be held if they have not filed tax returns for 2010 and 2011. In addition, the refund will be applied to any amounts still owed to the IRS, and may be used to offset unpaid child support or past-due federal debts such as student loans.

Do you have questions about the Refund Statute?

WorthTax can help you to bring your tax filings up-to-date. If you are not being with your tax filing obligations, please call Alex at 781-849-7200 and make an appointment today at one of our locations.

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