The IRS began accepting 1040’s this morning. Now that tax filing season is actually open, here’s a few items for all to understand and expect this season.
Deadlines
For the first time in the last couple of years, the service is back to it’s traditional deadlines. Partnership and S Corp returns are again due March 15, 2022. Estate, C Corp, and Personal income tax returns are due April 18, 2022 given the Emancipation Day observance in Washington D.C..
In order for us to guarantee that your returns are completed timely, final answers to your year end questions, must be received no later than two weeks before the deadlines.
Extensions
An automatic six month extension is available again this year. If your final answers are not received two weeks before the deadlines, your returns will be automatically extended.
Let’s remember that an extension does nothing more than extend the due date of the actual return. It doesn’t extend the due date of any payment that may or may not be due when the return is ultimately completed.
If you would like to make a payment with your extension to stop any potential payment penalties, please let us know.
2021 Oddities
First on the list are the Advance Child Tax Credit Payments and the Stimulus Payments that went out last year. Anyone who received either will receive a letter from the IRS detailing the payments.
This letter will be important this year given the fact that without having the exact amounts of money received, we may make a mistake on your return. This potential issue would slow down processing your return and change refunds or any amounts that may be due.
2020 ERC’s
As mentioned in earlier communications, if you filed for a 3rd or 4th Quarter 2020 Employee Retention Credit, we will be forced to do an amendment. This amendment is necessary whether you’ve received the money or not.
No one needs to tell me how unreasonable and unfair this is. These amendments will create income which will also create penalties.
This rule is by definition patently unfair, but there isn’t anything that I can do about it. Trust me when I say, that the last thing I want to do this tax season, is be forced to amend half of my returns.
I had hoped that this rule would change, but it hasn’t so far. If it does, I’ll let you know.
Can Congress Still Change 2021 Tax Law?
They can do anything they want. But given the congressional logjam, I sincerely doubt that anything else will get done.
Given the lack of new tax legislation, we’ve been able for the first time in several years, to begin processing returns the third week of January. If they do change something in the coming weeks, we would simply need to amend.
Please get your work into us ASAP.
Let me leave you with this.
The IRS backlog doesn’t seem to be ending, nor does it look like it will end anytime soon. The Service is still trying to process everything virtually, which has slowed things down to a snail’s pace.
There isn’t anything that anyone can do about this.
If you’re still waiting on a refund from 2020, nothing is stopping you from filing your 2021 returns timely. All returns going into the Service are time stamped and handled in the order received.
I don’t want anyone ending up not filing this year and paying penalties because they’re worried about the IRS’ internal issues. Get your work into us today, and let’s get it done on time.
We’re all going to get through this. Let’s get through it together.
Accounting Solutions Ltd. stands ready to complete our mission and purpose of protecting you, your family, and your business. Whether you need Employee Retention Credits, PPP Loan Forgiveness, Payroll Services. of Accounting and Tax Work, you have but to ask. I’m here and I remain,
Sincerely yours,
Chris Amundson
President
Accounting Solutions Ltd.
773-267-7500
www.AccountingSolutionsLtd.com
Note that the only professional services provide by Accounting Solutions Ltd. are those specified in a written communication from our office detailing the scope of services to be rendered and the terms and conditions applicable to the engagement.