National Tax Day has been extended and info on stimulus payments

Today, April 15, is National Tax Day since this is usually the day every year that our taxes are to be filed and paid in full without penalty fees. However, the IRS has extended the deadline to June 15, 2020, due to the nationwide lockdown resulting from the Coronavirus outbreak. So you have two extra months to file if you have not done so already.

Stimulus Payment

The CARES Act authorizing stimulus payments directly to individuals has been passed into law. The government has begun issuing out the Economic Impact Payment, also called the stimulus payment. Here is what you need to know if you have not yet received yours.

Eligibility

To be eligible, you must be a U.S. Resident with a gross income of less than

– $75,000 for Individuals

– $112,500 for Head of Household filers

-$150,00 for Married Filing Jointly

If you make more than the above-listed income, then you may still be eligible for a reduced payment. See more on the IRS.gov website. If your income exceeds the specified threshold, additional provisions may apply to determine your eligibility for a partial benefit. It’s important to review the guidelines carefully and use the tools provided on the IRS website to calculate your entitlement. Additionally, when managing your finances during these times, it’s wise to prioritize essential expenses and consider advice from financial experts, such as the recommendation to avoid extended warranties, which can sometimes be an unnecessary cost.

How much?

Those who meet the above criteria will receive the following payment:

• $1200 for individuals
• $2400 for married couples filing jointly
• $500 for each eligible child dependent (16 or younger)

This is not just an advance on next year’s taxes. (well not quite)

The IRS is adding a new credit to next year’s taxes that have never been there before. This stimulus payment is your advance on this new credit. So technically it is an advance, but in the end, you will have still have $1200 or more money than if there was no stimulus check.

How do I ensure I will be paid?

• If you have filed your 2018 and 2019 taxes, then there is no further action, and you should receive payment in the same form as your refund. If you have changed addresses since you filed, then update your information HERE.
• Soon, you will be able to check the status of your payment and update your preferred payment method HERE. (available mid-April)
• If you did not file or do not need to file taxes, then ensure you update the IRS on your address and payment methods to ensure you receive payment HERE.

NOTE: The IRS is warning taxpayers about potential scams related to the economic payments. Below is their statement from IRS.gov

The IRS urges taxpayers to be on the lookout for scam artists trying to use the economic impact payments as cover for schemes to steal personal information and money. Remember, the IRS will not call , text you, email you or contact you on social media  asking for personal or bank account information – even related to the economic impact payments. Also, watch out for emails with attachments or links claiming to have special information about economic impact payments or refunds.

Where can I file my taxes for free?

Tax filing services have entered an agreement with the IRS in order to maintain control of the filing software and ensure the IRS does not develop its own software, making the rest obsolete. This agreement requires tax companies to offer a free-file version for those who make less than $66,000 a year.

You can find a list of all the free file services for both federal and state at the IRS website. Some of the primary providers are:

• TaxSlayer
• H&R Block
• FreeTaxUSA
• TurboTax
• Online Taxes at OLT.com
• TaxAct
• MilTax (MilitaryOneSource’s software)

For free-file services and state-specific free-file services, visit the IRS website for all available providers.

Be careful you are at the actual free-file service website. For instance, TurboTax’s actual IRS approved free file site is https://freefile.inuit.com and not their main site https://turbotax.intuit.com/. TurboTax and other services have designed their whole business in tricking people to their paid version. They are required to offer a free version due to their agreement with the IRS but can also offer a paid version. ProPublica has a great article on this shady practice.

The popular podcast Reply All did a whole episode on how TurboTax has designed a maze to trick people into paying for their so-called “free tax file.” Listen to episode #144 Dark Pattern.

If you are having issues with the IRS, you may have to be patient. Currently, the IRS is very hard to reach, The IRS live phone assistance is not currently available, and if you call you will get a recording. All local taxpayer assistance centers are closed and have stopped all face-to-face service nationwide. They are still processing and issuing tax returns.