There are many disruptions that can slow down your tax refund, creating a significant delay in the time that it takes to receive your money from the IRS. Filing your tax return as son as possible will get you toward the front of the line as refunds are processed in the order that returns are received. E-filing will reduce the time that it takes the IRS to receive and process your tax return, eliminating delays caused by the mail.
The IRS typically issues a tax refund within 21 days of receiving electronically filed returns and 42 days after receiving paper returns. Mail delivery is taking longer to process so this may be delayed if you are mailing your tax return or are expecting a check by mail as your refund. The IRS’ web site allows you to track your refund status at Get Refund Status (irs.gov). You will need your social security and the anticipated refund amount that you are expecting.
Once married, you and your spouse can file taxes jointly, which has a number of tax benefits. If either one of you makes significantly less income, this can lower your tax bracket and reduce your tax rate. Combining incomes will bring the partner in the higher tax bracket to a lower level, reducing the couple’s overall tax bill. There are also more deductions available to married couples filing jointly, including a higher threshold for charitable contributions and residency gain.
Homes that are used solely for personal use cannot have the cost of home improvement projects deducted. However, if down the road you sell your home for a profit the money paid for home deductions can be deducted from this profit. This ends up being less of a profit that will be taxed when the home is sold. If part of the home is used for business and this area is affected by the renovations, you can deduct 100% of this cost.
While employers and institutions have a deadline for sending out tax paperwork, there are plenty of reasons it may fail to get into your hands. Whether lost in the mail, misplaced or some other event, the best step is to contact the issuer of the document. They may be able to send a duplicate copy right away. If you are still not having any luck getting the missing document, you can call the IRS. Providing information to the IRS about the document in question will make sure that you are covered when you go to file your taxes.
Not filing your taxes on time could result in a failure-to-file penalty. This penalty is 5% of the unpaid taxes for each month that the tax return is late, up to five months. Continuing to ignore your taxes could result in the IRS taking action in the form of a federal tax lien on your property, seizing your property and even filing charges for tax evasion.
The government’s recent stimulus package was distributed to millions of Americans. The stimulus money is not considered income by the IRS and will not be taxed. While the money itself is not taxed, this will count toward your household’s adjusted gross income for 2020. For some, this additional income may be enough to put you into a higher tax bracket.