What's all this tax stuff about Feb 15th?

[rebecca100]

There is a tax estimate calcultor online that you could probably try and compare the results. I am expecting about the same as I got last year according to it. Hope it is right becuase we need a new pickup. Dh's has bit he dust-again. You can only work on something so much before it is time to switch up.

 

[homesteadmomma]

I have already got my tax return back and paid on debt. I have heard that if you itemize you can't file until February 15th.

 

[Bethanial]

From the IRS:

For most taxpayers, the 2011 tax filing season starts on schedule. However, tax law changes enacted by Congress and signed by President Obama in December mean some people need to wait until med-to late February to file their tax returns to give the IRS time to reprogram its processings systems.

Some taxpayers - including those who itemize deductions on Form 1040 Schedule A - will need to wait to file. This includes taxpayers impacted by any of three tax provision that expired at the end of 2009 and were renewed by the Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010 enacted Dec 17. Those who need to wait to file include:

* Taxpayers Claiming Itemized Deductions on Schedul A. Itemized deductions include mortgage interest, charitable deductions, medical and dental expenses as well as state and local taxes. In addition, itemized deductions include the state and local general sales tax deduciton that was also extended and which primarily benefits people living in areas without state adn local income taxes. Because of late Congressional action to enact tax law changes, anyone who itemizes and files a Schedule A will need to wait to file until mid-to late February.

*Taxpayers Claiming the Higher Education Tuition and Fee Deduciton. This deduction for parents and students - covering up to $4000 of tuition and fees paid to a a post-secondary institution - is claimed on Form 8917. However, the IRS emphasized that there will be no delays for millions of parents and students who claim other education credits, including the American Opportunity Tax Credit extended last month and the Lifetime Learning Credit.

*Taxpayers Claiming the Educator Expense Deduction. This deduction is for kindergarten through grade 12 educators with out-of-pocket classroom expenses of up to $250. The educatior expense deduction is claimed on Form 1040, Line 23 and Form 1040A, Line 16.

In addition to extending those tax deductions for 2010, the Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act also extended those deductions for 2011 and a number of other tax deductions and credits for 2011 and 2012 such as the American Opportunity Tax Credit and the modified Child Tax Credit, which help families pay for college and other child-related expenses. The Act also provides various job creation and investment incentives including 100 percent expensing and a 2-percent payroll tax reduction for 2011. Those changes have no effect on the 2011 filing season.

The IRS will announce a specific date in the near future (our office received this notice 14 Jan 2011) when it can start processing tax returns impacted by the recent tax law changes. In the interim, taxpayers affected by thes tax law changes can start working on their tax returns, but they should not submit their returns until IRS systems are ready to process the new tax law changes. Additional information will be available at www.IRS.gov .

For taxpayers who must wait before filing, the delay affects both paper filers and electronic filers. The IRS u rges taxpayers to use e-file instead of paper tax forms to minimize confusion over the recent tax law changes and ensure accurate tax returns. (If you pay somebody to file your taxes, it HAS to be e-filed.)

Except for those facing a delay, the IRS will begin accepting e-file and Free File returns on Jan 14. Additional details about e-file and Free File will be announced later this month.

Sorry for any typos; I'm retyping this from a printed sheet and not copy/pasting from the IRS.gov website. Anything in italics like this are my notes and not in the notice We've heard anything from 14 Feb to 28 Fed as the date that these can be filed. Hope this helps

 

[Bettacreek]

UGH!!! This is the first year I've ever had any issues with taxes... TurboTax is telling me that I am inelligible for the Additional Child Tax Credit (ie, any of the $1k per child over what I owe in). I meet all of the requirements, so I'm not sure why it's telling me that I cannot get it. I've been on hold for 13 minutes with the IRS waiting to hear from them and get the damn straight truth (imagine that, from the IRS, lol)

 

[Bettacreek]

Absolutely GREAT freaking news </sarcasm>. This year, they apparantly put a minimum on your earned income to receive the additional child tax credit, IE, the refund. The damn thing is $3k, and I didn't make that much. At this point I'm not sure what to do. :/ $512 is so NOT what I was expecting for my returns this year.

 

[glenolam]

Sorry to hear about that Bettacreek - that's a bummer for sure.

One thing I frequently tell people (dacjohn's mentioned it above too) is that the withholdings changed in 2010. Less taxes were taken from your paychecks; therefore, you should expect less in your return assuming everything else is the same. I told people in the beginning of last year they should review their withholdings and earnings around June and compare it to previous years. Assuming everything else is staying the same (mortgage interest, property taxes, exemptions/deductions) you can estimate how much you'll be getting back or owing.

And the tool that rebecca mentioned is great. On the IRS website you can use their IRS Withholding Calculator and input your earnings to date and other information based off your most recent pay stub(s) and it will tell you what it looks like your withholding should be.

I know it's frustrating and my DH is NOT going to be happy this year - he's one of those that think he's owed all the money in the world, but doesn't want to listen to the restrictions and laws that are placed against us.

BTW - Turbo Tax and other tax prep software like that is great; I used Turbo Tax a few years ago, but then I heard about another type that was free. TaxAct is a "free" filing site that stores all your information in an on-line format. I believe the IRS e-filing is free and you can e-file one state return; all other states or filings cost about $12 or something cheap like that. I've used it for 3 years now and love it. I always keep paper copies, but don't have to buy a CD to install on my computer - just log into their website (which claims to be secure) and they automatically pull up all your information if you used them the prior year. They do prior year reviews and side-by-side comparisons for you so you can see line by line what was different.

ETA - and, don't forget that this year FICA taxes were changed too. Social security withholdings are much much less than they have been in prior years so, that puts a little more in your take home pay. BUT a little more is taken in federal taxes to account for the 'extra' money you're bringing home.

Let's take me for example - here's the differences in my taxes from the last paycheck in Dec and the first paycheck in Jan:

State income tax: $0.09
Fed income tax: $13.26
Medicare: $0.03
Social Security: ($41.06)

So my social security withholding went down $41, but my federal tax withholding went up by $13 because of that. As a result of all of this, I get an additional $30 every other week (I'm on a biweekly payroll) meaning I should expect approximately $780 less in my return if compared to the prior year.

Now - if you don't want to see that much less in your return, simply file a new W4 with your employer and on line 6 where it says "Additional amount, if any, you want withheld from each paycheck" put an extra $10-$20 per paycheck towards the IRS. That may increase your return, provided that's what you want.