Reduced Refunds: Will Your Refund Be Garnished? You may have already received your tax documents for the 2022 season and it’s time to file. Many taxpayers experience some anxiety around filing season because of uncertainty. Will you owe the IRS? Will your refund be garnished? There are a few instances where you can expect the IRS to reduce your refund, or garnish the whole thing.
Side Hustles and Taxes: What You Need to Know Philip Hwang, Lead Tax Attorney, and Optima CEO, David King provide useful tips so that you can understand whether or not you owe, and when you should file your side-hustle income.
Pending Status on Previous Tax Returns Can Delay this Year’s Return Millions of Americans have been waiting for tax returns and refunds from previous years, causing even more delay for 2022. If your returns from last year are still pending, then your return will be delayed this year as well.
Working with a qualified tax preparer can lessen the likelihood of delays and mistakes when you file. What makes a tax preparer qualified? Lead Tax Attorney Philip Hwang and CEO David King discuss tips for choosing your tax preparer. The Tax Show hosts cover types of tax professionals, credentials, minimum requirements, and red flags to look out for. Tune in to learn how to choose the best tax preparer for your tax situation.
From the start, the COVID-19 pandemic has been the biggest setback for the IRS. Millions of Americans have been waiting for tax returns and refunds from previous years, causing even more delay for 2022. If your returns from last year are still pending, then your return will be delayed this year as well.
How to avoid delayed or rejected tax returns
Electronic filing of your taxes is a great way to lessen the likelihood of delays. You can also validate your return with last year’s adjusted gross income so it doesn’t get rejected.
What to do if last year’s tax return is pending
National Taxpayer Advocate Erin Collins recommends entering $0 for your 2020 adjusted gross income when you file online.
If you collected the advanced child tax credit or your stimulus via the non-filer tool in 2021, the IRS recommends entering $1 for last year’s adjusted gross income.
There’s a possibility of the IRS rejecting your electronic return if you do not follow these steps. A tax software would typically send you a rejection email if your return shows conflicts with your adjusted gross income.
Missing tax return notice CP80
Receiving a CP80, or notice of a missing tax return could also leave your return in a pending status. If you received this notice and your return is still pending, you should also enter $0 for your 2020 adjusted gross income.
There is a chance that the IRS processed last year’s return after sending the notice. In which case, your adjusted gross income of $0 will be rejected. Should this happen, you can refile your 2021 return with the correct adjusted gross income.
How to check the status of your 2020 return
It helps to have a transcript to check the status of your 2020 return if you aren’t sure.
If you have a delinquent tax liability and need assistance with your 2020 return, call Optima for a free consultation at (800)536-0734.
Have you ever used PayPal or Venmo? These third-party payment apps have gained the attention of the IRS. Many Americans use these apps casually for group outings, while others have been using them for their side-hustle transactions. Filing requirements have drastically changed in 2021, now requiring taxpayers to report income of $600 or more using one of these apps. Philip Hwang, Lead Tax Attorney, and Optima CEO, David King provide useful tips so that you can understand whether or not you owe, and when you should file your side-hustle income.
Are you preparing to sell a property, but you have a tax liability? Liens can be a hindrance to real estate transactions, but they don’t have to be. Optima’s Lead Tax Attorney Philip Hwang shares some vital tips with CEO David King on how to deal with your lien before selling. The Tax Show hosts cover everything from how to find out if a lien has been filed, to how to withdraw a lien. Give yourself plenty of time to sort out your lien with a tax professional before refinancing or selling your home.
