Author Archives: c06876406

NYSDTF Extends Tax Due Date to May 17, 2021

The Tax Commissioner has extended the due date for New York State personal income tax returns, and related tax payments, for the 2020 tax year from April 15, 2021, to May 17, 2021.
Accordingly, 2020 personal income tax returns originally due on April 15, 2021, and related payments of tax, will not be subject to any failure to file, failure to pay, late payment, or underpayment penalties, or interest if filed and paid by May 17, 2021. Interest, penalties, and additions to tax with respect to such extended tax filings and payments will begin to accrue on May 18, 2021.
Read More Here….

IRS begins delivering 3rd Economic Impact Payment to Americans

IR-2021-54, March 12, 2021

WASHINGTON — The Internal Revenue Service announced today that the third round of Economic Impact Payments will begin reaching Americans over the next week.

Following approval of the American Rescue Plan Act, the first batch of payments will be sent by direct deposit, which some recipients will start receiving as early as this weekend, and with more receiving this coming week.

Additional batches of payments will be sent in the coming weeks by direct deposit and through the mail as a check or debit card. The vast majority of these payments will be by direct deposit.

No action is needed by most taxpayers; the payments will be automatic and, in many cases, similar to how people received the first and second round of Economic Impact Payments in 2020. People can check the  Get My Payment tool on IRS.gov on Monday to see the payment status of the third stimulus payment.

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New Exclusion of up to $10,200 of Unemployment Compensation

If your modified adjusted gross income (AGI) is less than $150,000, the American Rescue Plan enacted on March 11, 2021, excludes from income up to $10,200 of unemployment compensation paid in 2020, which means you don’t have to pay tax on unemployment compensation of up to $10,200. If you are married, each spouse receiving unemployment compensation doesn’t have to pay tax on unemployment compensation of up to $10,200. Amounts over $10,200 for each individual are still taxable. If your modified AGI is $150,000 or more, you can’t exclude any unemployment compensation.

The exclusion should be reported separately from your unemployment compensation. See the updated instructions and the Unemployment Compensation Exclusion Worksheet to figure your exclusion and the amount to enter on Schedule 1, lines 7 and 8.

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2021 tax filing season begins Feb. 12

2021 tax filing season begins Feb. 12; IRS outlines steps to speed refunds during pandemic

IR-2021-16, January 15, 2021

WASHINGTON ― The Internal Revenue Service announced that the nation’s tax season will start on Friday, February 12, 2021, when the tax agency will begin accepting and processing 2020 tax year returns.

The February 12 start date for individual tax return filers allows the IRS time to do additional programming and testing of IRS systems following the December 27 tax law changes that provided a second round of Economic Impact Payments and other benefits.

The IRS anticipates a first week of March refund for many EITC and ACTC taxpayers if they file electronically with direct deposit and there are no issues with their tax returns.

Read the complete News Release here.

IRS Expands IP PIN Opt-In Program beginning January 2021

The following is a message from the IRS Wage & Investment Division:

 We wanted to give you a heads up on some important information for your clients and for you involving the Identity Protection PIN. Starting in January 2021, the IRS will expand the IP PIN voluntary opt-in program nationwide. The six-digit IP PIN provides additional protection against tax-related identity theft.

Here’s how it works:

  • Starting in January 2021, taxpayers may go to the Get an IP PIN tool on IRS.gov, pass Secure Access authentication and immediately access a six-digit IP PIN.
  • Do not file a Form 14039, Identity Theft Affidavit, for clients who are not tax-related identity theft victims and who are voluntarily opting into the program.
  • When prompted by tax preparation products, clients or their tax preparers must enter the IP PIN issued to the primary and/or secondary taxpayers or their dependents.
  • An electronic return without a correct IP PIN will be rejected; paper returns will be subject to greater scrutiny.
  • Taxpayers with either a Social Security number (SSN) or Individual Tax Identification Number (ITIN) who can verify their identities are eligible.
  • An IP PIN is valid for one calendar year. Clients must obtain a new IP PIN each year at the start of the filing season by accessing the account they created at www.irs.gov/ippin.
  • While currently there is no opt-out feature, we are looking to add this feature later for taxpayers with online access.

Alternatives to online Get an IP PIN tool:

  • Taxpayers who cannot authenticate their identities online and who made $72,000 or less may file Form 15227, which will be available January 2021. An IRS assistor will call taxpayers to ask a series of questions to verify their identities. An IP PIN will be issued at the start of the next calendar year.
  • Taxpayers who cannot authenticate online and who made more than $72,000 will have an option, still being vetted, to verify their identities in person at an IRS office. An IP PIN will be issued within 3 weeks if their identity is authenticated at a local office.

No change for victims of tax-related identity theft:

  • File a Form 14039 for clients whose e-filed returns reject because a duplicate SSN filing; mail it with the client’s paper tax return.
  • The IRS will investigate the case and remove the fraudulent return.
  • Once the case is resolved, the client automatically will receive an IP PIN via postal mail at the start of the next calendar year.
  • Confirmed identity theft victims may not opt-out of the IP PIN program because of risks.

We will keep you in the loop as we move forward. It’s likely that 2021 will be a test-and-learn year, and we may make additional changes as we receive feedback from taxpayers and tax professionals.

New York State Tax Notice N-20-8 INCORRECT (June 30, 2020)

NYSSEA learned late yesterday (June 29, 2020) that the NYS Department of Taxation & Finance’s Notice N-20-8 is incorrect. https://www.tax.ny.gov/pdf/notices/n20-8.pdf

The notice says that the 1st quarter estimated tax payment is due 6/15 and the 2nd quarter 7/15, but in fact, it’s the opposite.  The 1st quarter payment is due 7/15, and the 2nd quarter is (was) due 6/15.

NYSSEA strongly urged NYSDTF to notify taxpayers and the tax professional community promptly.

1040-X Options Announced by the IRS

IRS announces Form 1040-X electronic filing options coming this summer; major milestone reached for electronic returns

NOTE:  Initially, this will be offered only for tax year 2019

IR-2020-107, May 28, 2020

WASHINGTON — The Internal Revenue Service announced today that later this summer taxpayers will for the first time be able to file their Form 1040-X, Amended U.S Individual Income Tax Return, electronically using available tax software products.

Making the 1040-X an electronically filed form has been a goal of the IRS for a number of years. It’s also been an ongoing request from the nation’s tax professional community and has been a continuing recommendation from the Internal Revenue Service Advisory Council (IRSAC) and Electronic Tax Administration Advisory Committee (ETAAC).

Currently, taxpayers must mail a completed Form 1040-X to the IRS for processing. The new electronic option allows the IRS to receive amended returns faster while minimizing errors normally associated with manually completing the form.

Read more…click here.