IRS has several online videos and articles designed to help taxpayers figure out the impact of tax reform on their returns. These can be found at irs,gov by clicking on the Tax Reform tab on the home page.
The new W-4 Employee’s Withholding Allowance Certificate is now available. It is similar in design to the old certificate, but it contains new calculation guides for determining the number of exemptions that a taxpayer should take.
Taxpayers with more than one job or more than one income source might need to complete the two earner or multiple jobs worksheet on the last page to ensure that enough money is withheld to cover the estimated tax liability.
Remember the tax bill is based on total income, not on individual wages or income sources.
Standard mileage rates were released during the Christmas holidays. The new rates for business miles increased to $0.56 per mile. Medical and moving mileage increased to $0.20 per mile, while charity mileage remains the same at $0.14 per mile.
IRS has just announced that electronic filing of 2018 returns will begin on Jan. 28. Much of the IRS staff is on furlough and it is expected that some employees will be called back to work.
Refunds due will be paid. Balance due and 2018 fourth quarter estimated payments are expected to be paid on time.
If you file your returns early in hopes of an early refund, you might see your refund paid after the laid-off employees are back to work.
This year, taxpayers filing as Head of Household with dependent children will undergo additional scrutiny. Their preparers will be required to file additional forms testifying that they have seen proof of residency and dependency.
There have been too many cases of husband and wife living together with each filing as Head of Household, splitting the children and one using a Post Office box as an address. Then, both claim earned income credit.
If caught, penalties can be assessed against both the taxpayer and the preparer – and the penalties are pretty stiff.
For more information for specific questions, visit IRS.gov.
Virginia Moryadas is a tax preparation professional in Bluffton.