- The IRS has started sending out letter 5071C to verify identity. You receive this letter when the IRS has a return with your name and Social Security Number and something has raised a red flag. Before they send out a refund they want to make sure that you did file that return. You are asked to go to idverify.irs.gov or call a special number. You’ll need last year’s tax return (and this year’s if you’ve filed) with your W-2s, 1099s, and Schedule A and C. This isn’t a hoax. Letter 5071C will be mailed to you.
- Tax reform proposals have started to show up and cover a wide base of ideas. More on them later (after April 16th) but one that caught my eye was a proposal to require businesses to have their W-2s to the IRS faster. The concept is that the sooner the IRS has the W-2 information the better they can check returns and hopefully stop fraudulent returns. I don’t know how much that will help unless they also delay the filing start date. We’ll see.
- Now is the time to get your tax info to your preparer. The longer you procrastinate the more you run the risk of needing an extension because your tax pro can’t get to the return or you discover you are missing something important.
- Extensions only give you more time to file a complete return. It doesn’t give you more time to pay. You are expected to estimate any balance due and send that in by April 15th.
- If you owe and can’t pay the balance due, file your return on time. You might consider an installment agreement but file the return to stop the failure to file penalty.
- If you don’t like your tax return results, now (April 16th) is the time to make adjustments to withholding and estimates. The same goes if you are expecting any life changes that will affect your 2015 tax return. Changes include, but are not limited to, marriage, divorce, new child, child leaving home, and retirement.
That’s all I can think of right now. It’s back to returns.