We are cranking along with tax return preparation here at Peter D. Arnold, CPA, and there are some interesting things that you should know about from Tax Land (that wild, scintillating world that it is).
Look — it is our J-O-B to handle this junk so you don’t have to, which is why I make it a point to not be too tax-heavy in my notes to you. But this week, well, there’s just a few too many things to ignore.
Firstly, did you know the government “shut down” for a few hours Friday night? It was a function of the Congresspeople finally coming to a budget deal, and, well … it might mean some changes for YOU and many in Cape Cod (and it might not).
Buried in the deal were a variety of tax credits that HAD been expired for 2017 taxes, but which were suddenly reinstated. If you want to get very, very wonky, you can see the full list right here (beginning at Section 40101) — but here are some high points:
above-the-line deduction for qualified tuition and related expenses
mortgage insurance premiums treated as qualified residence interest
exclusion from gross income of discharge of qualified principal residence indebtedness
credit for nonbusiness energy property
credit for residential energy property
credit for new qualified fuel cell motor vehicles
credit for alternative fuel vehicle refueling property
credit for 2-wheeled plug-in electric vehicles
Basically, Cape Cod students, homeowners, and energy-savers got their breaks restored. If this affects you, we can amend your return if you would like to account for these breaks.
However, my suggestion is that we wait a bit to see how the IRS responds, because they don’t actually have full clarity about what they will be doing about them just yet. Shocking, I know.
But I don’t blame them, because this is pretty last-minute, even by Congressional standards.
Finally, I’m going to use my Note this week to clear up some confusion about tax refunds that have been the subject of a bunch of questions from Cape Cod clients this year. Here’s what’s really happening…
2018 Tax Refunds Have You Confused? Peter Arnold Provides Clarity
“The truth can be funny but it’s not funny to cover up the truth.” -Ryan Cooper
Fake news is something we’re used to handling around here at Peter D. Arnold, CPA — you know the drill: “My neighbor’s uncle has a friend who is an accountant and HE said that my support parakeet is 100% deductible — and can even be counted twice!”
Yes, well … isn’t that precious.
Aside from those kinds of silly examples, there is some definite confusion about certain tax refunds this tax filing season, and we’re here to clear it up for you. Enough confusion, that the IRS issued a release about it (which you can read right here). I’ll deal with a few of those points, as well as a few other questions that we’ve received right here:
Confusion #1: Refund Delays
No, not every refund is delayed. Yes, EITC and ACTC related returns (both are child tax credits) WILL have delayed refunds. For every other kind of return in which a refund is expected, the IRS says that refunds should go out within 21 business days of filing. More about that below.
But about those EITC and ACTC refunds — unless you got some sort of advance on your refund, those might even take a little longer than was promised. The IRS said they will begin processing those on February 15th, but those refunds won’t begin to hit bank accounts until 2/27 — and that’s for those who chose direct deposit, and for whom there are no other issues.
So, hang tight.
Confusion #2: Checking On Refund Status
Have you heard that if you order a tax transcript it will tell you when to expect your refund?
Or if you call the IRS help hotline or ask US to call on your behalf that you’ll get a definite refund delivery date?
Whoops, more fake news. These social-media touted refund inquiry workarounds won’t work.
The information on a tax transcript does not necessarily reflect the amount or timing of a refund.
And as for calling us about it, we have no additional ways to check your refund status, unfortunately.
And sure, you can call the IRS directly … but be prepared to wait on hold for a looong time, and to receive no further information.
The BEST place to check, always is “Where’s My Refund” on the IRS website, which is right here: https://www.irs.gov/refunds
Confusion #3: “Is The IRS Calling Me???”
Short answer: No.
Longer answer: Nope.
Full answer: The IRS does NOT initiate contact with taxpayers by phone, email, text messages or social media to request your personal, tax or financial information.
If you are contacted in one of these ways regarding your refund — either a caller saying you owe more or an email promising a bigger refund — the communication isn’t from the IRS, even if the caller or emailer says they are agents. They are crooks looking to assume your tax identity and take your money.
Alright then. Glad we’ve cleared all of that up.
And in all seriousness: remember that we are in your corner. We’re here to help, and love to serve our Cape Cod clients, so whatever advice you need, we’re just an email or phone call away.
To your family’s financial and emotional peace …
Peter D. Arnold, CPA