Natural disasters can be devastating, both emotionally and financially. One of the most immediate challenges is often the loss of important documents, including tax records. Fortunately, the IRS offers valuable tips to help you Rebuilding Your Records After a Natural Disaster and navigate the tax implications of a disaster.
Rebuilding Your Records After a Natural Disaster
Understanding the Importance of Tax Records
Your tax records are essential for various reasons, including:
Filing future tax returns: Without these records, you may face difficulties in accurately reporting your income and deductions. Recover losses: If you suffered damage to your property, you may be able to claim a deduction on your taxes. Obtain insurance benefits: This includes presenting evidence of your losses to your insurer. Get financial assistance: Another thing to notice is that it’s possible to gain assistance through other means, such as loans, if you can prove your financial hardship.
Gathering Essential Information
Start by collecting as much information as possible about the disaster. This includes:
Date of the disaster: This will help you narrow down the timeframe for your record search. Type of disaster: Knowing whether it was a hurricane, flood, fire, or other event can provide insights into the potential impact on your records. Location of the disaster: This will help you determine which records may have been affected.
Rebuild these records:
Tax returns: Keep copies of your most recent tax returns. W-2s and 1099s: These forms show your income from employment and other sources. Receipts and canceled checks: These documents can prove your expenses. Bank and credit card statements: These statements show your income and spending. Insurance policies: Keep copies of your home, auto, and other insurance policies. Property records: This includes deeds, titles, and appraisals.
Rebuilding Your Records
Here are some strategies to help you rebuild your tax records:
Contact your financial institutions: Banks, credit unions, and investment firms can often provide copies of statements, canceled checks, and other financial documents. Requesting replacement W-2s and 1099s from your employer or other payors: These forms can be obtained by contacting the IRS. Using your insurance company: Your insurance company may be able to help you recover your records. Checking with your local government: Your city or county may have a disaster recovery center that can provide assistance.
Claiming Disaster-Related Deductions
Victims of disasters can take comfort in the fact that it is possible to reduce their IRS taxes by utilizing appropriate tax deductions. Contact a tax consultant, who will be able to provide you with a list of what types of expenses can be deducted and what documents you need for it.
It is pertinent to mention, that account restoration after any unusual occurrence will not be an easy and straightforward task. Nonetheless, you must try to be strong, and as you follow the above tips and seek help where needed, you should once again have your financial records updated and even get over the ramifications of the disaster to your taxes.
In an era defined by technological leaps, the Internal Revenue Service (IRS) is orchestrating a monumental shift, bidding adieu to the era of paperwork-laden tax processes. With a firm embrace of paperless tax processing, the IRS is steering into the fast lane of efficiency and user convenience, ushering in a new era for taxpayers nationwide.
The days of grappling with unwieldy paper forms and the slow crawl of snail-mail submissions are now relegated to history. Armed with cutting-edge technology and digital infrastructure, taxpayers can now seamlessly complete their tax filings online, trading laborious efforts for streamlined efficacy.
This paradigm shift isn’t just a boon for taxpayers; it’s a catalyst for heightened accuracy and speed in tax processing. Human errors, often linked to manual data entry, are minimized, and the peril of lost documentation is drastically reduced, bolstering the security of sensitive taxpayer information.
As the IRS fervently embraces this digital metamorphosis, taxpayers can anticipate a notably smoother and harmonized experience. A swift farewell to paper-piled chaos and a hearty welcome to an expedited, user-friendly tax season.
Leveraging Digital Advances for IRS Advantages
The migration towards paperless tax processing augments the IRS’s operational prowess in multifarious ways. Primarily, it significantly curtails administrative expenses related to the management and storage of physical paperwork. With diminished reliance on printed forms and laborious data entry, the IRS can deftly allocate resources and intensify its focus on critical spheres of tax administration.
Furthermore, the paperless drive empowers the IRS to mechanize diverse phases of tax processing. By harnessing advanced technology, the agency transforms its operations, culminating in swifter and more pinpoint tax processing. This dexterity in automation curbs the dependence on manual labor, assuaging the risk of human blunders that often creep in during data entry and processing procedures.
Yet another feather in the cap for paperless tax processing is its augmentation of tax-related data accessibility. Armed with digital mechanisms, IRS personnel can seamlessly access and retrieve taxpayer data, obliterating the exigency for cumbersome physical file trawls. This access overhaul not only conserves time but bolsters the IRS’s potential to provide efficient and superior customer service to taxpayers.
All told, this transition marks the IRS’s galvanized stride toward fortified efficiency and efficacy, emerging as a win-win for both the institution and the taxpayers it serves.
A Technological Odyssey in IRS Tax Processing Evolution
The march towards paperless tax processing has been an incremental voyage for the IRS, a journey marked by persistent evolution. In bygone years, technology was still in its infancy, and the IRS found itself deeply entrenched in manual processes and paper-based forms. Taxpayers grappled with physically filling out forms and dispatching them via mail—an arduous voyage.
But as computers and the internet dawned, a new horizon emerged, urging the IRS to contemplate digital remedies. The early 1990s bore witness to the introduction of electronic filing options, a watershed moment that initiated the slow pivot towards paperless processing. With the advent of technological crescendos, the IRS was nudged towards the development of sophisticated digital systems, recalibrating the management of tax filings.
Today, the IRS stands steadfastly committed to the banner of paperless tax processing. Taxpayers are now beneficiaries of an array of digital filing choices, from web-based platforms to specialized tax software, gifting them the freedom to pick the path that resonates most profoundly. This evolution—from paper-thick rituals to digitized triumphs—has metamorphosed IRS operations, forever changing the tax filing landscape for millions of Americans.
Pioneering Technology’s Integration into Tax Processing
The surge of technology has unfurled a revolutionary tapestry across the landscape of tax processing. The IRS’s savvy integration of digital tools and systems has cast a transformative spell, empowering seamless automation, and bequeathing a cadence of efficiency and accuracy.
Among the crown jewels of this technological transformation is optical character recognition (OCR) technology. By rendering scanned paper documents into digital text, OCR equips the IRS with facile data extraction and manipulation, expunging the necessity for manual data entry. The fruit of this labor? Diminished errors and an accelerated processing tempo.
Delving deeper, the IRS has augmented its arsenal with formidable data analytics capabilities. Through meticulous analysis of voluminous troves of taxpayer data, the IRS detects patterns, anomalies, and potential discrepancies with an acuity that belies human cognition. Tax fraud detection is elevated, and adherence to tax laws is meticulously upheld.
Security, in an age fraught with digital vulnerabilities, emerges as an existential concern. Here, the IRS stands sentinel, fortifying taxpayer information with layers of encryption, impervious servers, and stringent access controls. The guardianship of sensitive data is paramount, and the IRS marches in lockstep with the escalating symphony of cybersecurity threats.
Embarking on a Digital Odyssey: Taxpayers’ Pantheon of Choices
The onset of paperless tax processing has flung open the gates to a galaxy of digital filing alternatives, effectively trouncing the era of ink-smeared forms and postal pilgrimages. The ritual of filling out forms and dispatching them to the IRS has been replaced with a pantheon of convenient digital platforms and software.
Enter the grand stage—the IRS’s very own virtuoso, the Electronic Filing System (e-file). This web-based sanctum grants taxpayers the privilege to craft and submit their tax returns electronically, navigating the labyrinth of tax filing with the precision of a maestro. E-file ushers in a realm where taxpayers glide through the complex symphony of tax questions, orchestrating submissions with unwavering confidence.
However, e-file isn’t the sole star of this digital constellation. Dedicated tax software takes center stage, donning the mantle of tax preparation virtuoso. These software marvels escort taxpayers through the journey, serenading them with error checks, calculations orchestrated in algorithmic harmony, and unfettered access to a treasury of tax forms and wisdom.
For the ardent admirers of professional guidance, the virtual realm beckons with equal allure. Professional tax preparation services, now donned in their digital garb, unfurl their expertise in a digital symposium. Taxpayers recline in the luxury of uploading tax documents, relegating the rest to the seasoned hands of experts.
Ushering in a Golden Era for Taxpayers
A digital dawn has bestowed upon taxpayers a platter of rich dividends. The greatest dividend—time, undeniably. The prospect of hours mired in form-filling and manual calculations is consigned to the annals of history. Digital platforms and software seamlessly hoist the mantle of simplification, quickening the pace and buoying spirits.
Yet, accuracy, a currency of paramount importance, garners another feather. Automated calculations and error checkpoints woven into the digital fabric stand sentinel, fending off errors that once sowed seeds of trepidation.
There’s more—a digital submission culminates in instant gratification, a swift acknowledgment that dissipates the anxiety of uncertainty. Unlike the quagmire of traditional mail, digital filings pave the path to immediate assurance—an attestation of successful delivery to the IRS’s digital sanctum.
The digital symphony doesn’t halt at mere submission. Embedded within the digital realm are tools that unearth potential treasure troves of deductions and credits, prodding taxpayers with poignant queries that lead to a mosaic of benefits
. A confluence of convenience and prudence.
In sum, paperless tax processing extends an olive branch of convenience, precision, and efficiency—a triumphant march into a new age of taxpayer empowerment.
Addressing Security in the Digital Frontier
In a digital saga, security emerges as the overarching saga—one that the IRS approaches with unwavering resolve. The virtual conveyance of sensitive data spawns concerns, and the IRS responds with a fortified bulwark of defense mechanisms.
Encryption—shielding the digital dance with an impenetrable cloak—is the linchpin of security. It safeguards the passage of data, an impervious tunnel where information remains cocooned, eluding prying eyes.
Robust servers and firewalls, stoic guardians of the digital realm, serve as the final line of defense. They rebuff the advances of nefarious actors, ensuring that the data sanctum remains inviolate.
But security isn’t a monologue—it’s a bilateral endeavor. Taxpayers, too, play a role. Vigilance in password choice, routine software updates, and discernment against phishing ploys comprise the ensemble of safeguards. A duet of IRS vigilance and taxpayer prudence scripts the saga of data security.
While no fortress is impregnable, the IRS continues to evolve its security lexicon, an evolving dialect that resonates with the cadence of the digital age. A synergy of systemic diligence and individual caution holds aloft the torch of security.
Charting the Voyage Ahead: The Irreversible March to the Future
The present isn’t the zenith; it’s a mere stepping stone in the IRS’s inexorable march towards the future. As technology unfurls its next chapters, the IRS stands poised to harness its essence, refining and amplifying the synergy between digital innovation and tax administration.
Automation emerges as a pulsating theme in this narrative—more stages of tax processing stand ripe for automation, birthing a realm where human intervention is pared down, yielding expedited outcomes. Artificial intelligence and machine learning stand ready, resolute in their mission to elevate data analysis and ferret out instances of tax fraud.
Moreover, digital avenues promise a more beguiling vista. The IRS envisions a more user-centric interface, a digital tapestry where taxpayers traverse with elegance, charting their tax journey with the panache of navigational virtuosos.
And then there’s blockchain—a beacon of promise that illuminates the horizon. This cryptographic marvel, revered for its unimpeachable transparency, beckons as a potential milestone in data security and processing efficiency. Taxpayers and the IRS united under the aegis of blockchain, scribing an epoch where data integrity reigns supreme.
The expedition toward paperless tax processing is a symphony, where each movement ushers forth an ode to modernity. As the IRS treads on, guided by the clarion call of digital evolution, taxpayers stand to gain—a melody of efficiency, accuracy, and convenience serenades their journey.
Nurturing Taxpayer Fortitude in the Digital Epoch
In this age of bits and bytes, taxpayers bask in a cornucopia of resources and tools—a grand tapestry that renders the tax labyrinth navigable and the journey, harmonious. A digital armory of knowledge unfurls before them, shaping the contours of informed decisions and assured navigation.
The IRS’s virtual sanctum, its website, stands as a fulcrum of taxpayer enlightenment. A treasure trove of insights unfurl—delineations of deductions, credits, tax forms, and legal currents—beckoning taxpayers to delve into a reservoir of wisdom. Accessible online, it chronicles the evolving saga of tax laws, a chronicle that taxpayers can scrutinize at their leisure.
Yet, tools abound, transforming taxpayers into maestros. The IRS’s Free File program emerges as a potent tribute, providing a respite from financial outlays in the form of gratis access to commercial tax software. A democratized domain, it invites individuals across income strata to partake in affordable tax filing exploits.
Online toolsets, too, grace the tableau. The Interactive Tax Assistant and the Online Payment Agreement tool emerge as steady companions, handholding taxpayers through the tangled thickets of tax understanding, payment calculations, and the orchestration of payment plans—a symphony where taxpayers are the conductors.
For those who seek sage counsel, a banquet of options sprawls. Tax professionals, be they enrolled agents or certified public accountants (CPAs), inhabit the virtual sphere, equipped with wisdom to unravel complexities. Digital consults unfurl, allowing taxpayers to confer with experts, their tax trajectory guided by the compass of seasoned counsel.
In this digital pageant, resources aplenty hold the lamp aloft. Whether IRS wisdom, free software, or the embrace of tax professionals, taxpayers glean insights and assistance to traverse the tax landscape with aplomb.
Curtain Call: A Grand Saga of Effortless Tax Administration
The IRS’s pas de deux with paperless tax processing marks a watershed moment—a proclamation of their commitment to efficiency and modernization. The resonance of technology crescendos, birthing an epoch where taxpayers and the IRS dance in synchrony toward a digital tapestry, enshrined in seamless tax administration.
Advantages galore cascade into the IRS’s lap—cost savings, efficiency gains, and elevated data accessibility. Automation wields its wand, culminating in agile service delivery and heightened taxpayer satisfaction. The IRS’s efficiency gains extend a generous embrace, fostering a realm where taxpayer experience reigns supreme.
For taxpayers, the rewards are manifold. Time and labor find their reprieve, errors recede, and the catharsis of swift submission unfurls. Deductions and credits, too, find a spotlight, as digital platforms metamorphose into shrewd navigators, guiding taxpayers toward optimum benefits.
Security stands guard as a sentinel—a pact forged between IRS vigilance and taxpayer prudence. Encryption safeguards the digital troves, firewalls repel digital marauders, and stringent access controls underpin the fortress. It’s a symphony played in harmony, a tune composed in unison.
As technology weaves its fabric into the future, the IRS stands poised for a grand unveiling. Automation’s chorus swells, interfaces become more user-centric, and blockchain beckons with its cryptographic embrace. The future is resplendent—a chiaroscuro of efficiency, accuracy, and convenience, painted onto the canvas of taxpayer empowerment.
In the digital epoch, resources abound, illuminating the path for taxpayers. From IRS sagas to free software symphonies and professional harmonies, taxpayers stand armed with a tapestry of tools and knowledge to navigate the labyrinthine tax journey.
In this grand finale, paperless tax processing stands not just as a proclamation, but a promise—a promise of a future where efficiency and convenience coalesce, crafting an epoch where taxes cease to be a tribulation and instead, emerge as a harmonious tax ballet.
Get your maximum tax refund with the Free H&R Block Tax Calculator. Use the easy-to-navigate estimator to quickly receive your potential refund in minutes.
Calculating your taxes has never been easier with H&R Block’s free tax calculator. This easy-to-use estimator quickly determines your maximum potential refund in minutes, providing you with peace of mind and helping to maximize your return.
With H&R Block’s free tax calculator, you don’t need a ton of experience with taxes or filing to get your maximum potential refund. Just input the details of your filings into the calculator, including income, credits and deductions, and let H&R Block do the rest. In no time, you will know exactly how much money you can expect back in return.
Monitor Your Refund Status.
After completing all of your required tax filing information, H&R Block’s free tax calculator will give you an estimate of how much you can expect to receive in return. From there, you can set up an alert policy with the calculator that will keep you notify of any changes that occur in your refund status. This way, you can easily stay on top of your taxes and ensure that everything is going as planned.
Use Expert Advice to Optimize Your Tax Refunds.
Not sure which deductions to claim or best strategies for filing? H&R Block’s free tax calculator provides easy access to tailored expert advice on how to optimize your return. Our professionals know the ins and outs of taxes and can help you take advantage of every opportunity that applies. With our useful guidance, you could be getting a larger refund or lower taxes in just minutes.
Get an Early Start on Filing Next Year’s Return.
You don’t need to wait until next tax season to start preparation! With the H&R Block free tax calculator, you can get a head start on filing your return and maximize your refund or minimize your taxes. Our easy-to-use estimator will help you plan ahead and develop strategies that can be implemented each year. Don’t wait to get started—start enjoying the benefits of our tax advice now!
Receive Expert Guidance for Complex Refund Situations.
Do you have complex investments, rental properties, or other earnings that make filing complicated? With H&R Block tax calculator services, experienced professionals are here to ensure that all your income sources are accounted for and properly interpreted to get your maximum refund. With expert guidance and years of experience in tax preparation, our advisors can create optimized strategies to save you money now and over the long term.
Get an instant status update on your tax refund or request a paper copy from the IRS. The IRS Refund Status page is one way for taxpayers and tax payers to keep track of their refunds as they are processed by the Internal Revenue Service (IRS).
The Internal Revenue Service (IRS) has made changes to its online services that will affect taxpayers filing for refunds.
The IRS is an agency that handles the tax year for the United States. They provide a variety of online services to taxpayers and tax payers. The IRS Refund Status section on their website provides information on the status of your tax refund.
The Tax Refund Status page is a part of the IRS Online Services website which allows you to check your refund status in real time. You can also find out if there has been any change in your refund status and when you should expect it to be delivered to you.
Go to irs.gov/refundstatus.
Taxpayers who filed electronically with the IRS before January 1, 2018, should see their refund within two weeks after submitting their return. If you file by mail, you should receive your refund within six weeks after filing.
Enter your Social Security Number (SSN).
To check the status of your refund, enter your SSN at . You will need your last four digits of your SSN.
Click “Get Status”.
If you have not received your refund yet, you should receive a message stating that your application has been processed. Once you do receive your refund, you can print out a copy by clicking on the link provided.
You will receive a confirmation email with your refund information.
To check the status of your refund, visit https://www.irs.gov/refunds. This site provides a list of all the states where you can expect to receive your refund.
Enter your Social Security Number (SSN) and Tax Year.
If you need more information about your refund, you can also call 1-800-829-1954. You will need to provide your SSN and the last four digits of your social security number.
Find out where you can live cheaply in the United States with our list of the 6 cheapest states to live for 2022.
Cheapest States To Live For 2022
The cost of living varies widely across the United States. Some areas are expensive, while others are cheap. This page shows how much money you need to earn to afford housing, food, transportation, healthcare, and other necessities.
Arizona
Arizona has been ranked as one of the top ten places to retire by Money Magazine. It also ranks high in terms of cost of living. According to the Bureau of Labor Statistics, the average annual salary in Arizona was $43,000 in 2017. That’s lower than the national average of $45,000.
Colorado
Colorado was ranked No. 1 on the list because of its low cost of living, high quality of life, and relatively safe environment. It also has one of the lowest unemployment rates in the country.
Wyoming
Wyoming has the lowest average cost of living in the U.S., according to the Council for Community and Economic Research (CCER). In fact, the state ranks first in affordability among states with populations under 100,000 people.
Montana
CCER says that the median household income in Wyoming was $51,971 in 2017, compared to $53,849 in Montana. However, the cost of living in Wyoming is lower than in other states. According to CCER, the cost of living index in Wyoming is 79.5, while the national average is 100.
North Dakota
In addition to having the lowest cost of living, North Dakota also has the highest median household income at $61,724. This means that residents there earn more money than people in any other state.
South Dakota
According to the U.S. Census Bureau, the average annual cost of living in South Dakota was $48,988 in 2016. That’s lower than the national average of $51,856. However, the cost of living in South Dakotans’ home state is still higher than the national average.
Doing your taxes is a tedious task that nobody enjoys. But if you have a business, it becomes even more complicated and time-consuming. The H&R Block tax calculator software makes calculating your taxes quick and easy. You don’t have to be an accountant or even know anything about taxes to use it.
Taxes are the most important and often the most confusing part of our financial lives. It is important to know how much we owe in taxes and how to pay them. The H&R Block Tax Calculator helps you calculate your federal income tax liability for the current year. It also provides estimates for future years based on your estimated taxable income.
The H&R block tax calculator is designed to help you quickly estimate how much you owe in federal income taxes. Simply enter your annual gross income and select one of our pre-built scenarios.
Find out how much you owe in state and local taxes.
If you’re self-employed, you’ll need to calculate both your business’s and personal income taxes. To do so, simply enter your annual gross income, choose whether you’re filing as a sole proprietor or partnership, and then select either “Business” or “Personal.”
See what deductions you may qualify for.
Once you’ve entered your income, you’ll see how much you owe in federal and state taxes. You can also view your estimated refund by entering your total income and subtracting any applicable credits.
Print your return.
If you’re filing as a business owner, you can print out your return right away. If you’re not sure whether you qualify as a small business, check with the IRS.
File electronically with the IRS.
It’s free to file your taxes online through the IRS website. You’ll need to provide your Social Security number (SSN) and bank account information. Once you’ve filed, you’ll receive a confirmation email with a link to download your W-2 forms.
The IRS has made it easier for US taxpayers to submit their tax returns electronically. The IRS offers a free e-file service, which is available to any taxpayer with a valid social security number and mailing address in the United States.
What is an e-file? An e-file is an electronic version of a paper tax return submitted through the internet. This means that you do not have to print and mail your taxes, as you would have done in the past. Instead, you can use an electronic tax software to complete your return and then submit it electronically to the IRS.
If you are looking for more information on how to file your taxes electronically, there are many helpful resources available on the IRS website or through various other websites and services.
In addition, if you want help filling out your taxes, there are various places that offer professional assistance with this process for a fee.
IRS Tax Estimator
If you’re like most Americans, you’re probably wondering how much of a tax refund you’ll get this year. The best way to find out is by using the free tax estimator from the IRS.
The estimator will estimate your federal and state taxes, as well as give you an estimate of your potential refund. All that’s required is some basic information about yourself and your family, such as age, income, marital status, and number of dependents.
It’s important to note that the estimator only provides an estimate for the amount of taxes owed. It does not calculate whether or not a taxpayer qualifies for any deductions or credits that could lower their total tax liability.
The IRS is warning taxpayers about a new scam that is playing out this year in relation to individual tax returns being filed. This IRS Refund Scam Alert is about deposits being made into bank accounts and then requests being made to reclaim the funds. Don’t fall for this one.
The problems being when your personal computer is hacked and the tax information for the year is stolen. This personal information is used to file a tax return in your name before you file your own taxes. This next part was new in 2018, the money from the return is deposited into the tax payers own bank account instead of stolen right away. At this point, the taxpayer is contacted and a request is made to return the incorrectly deposited refund. That’s pretty inguieness.
The taxpayer might receive a call from an IRS collection agency requesting the funds, but IRS never calls individual tax payers. Or he/she could receive an automated call from the IRS fraud department with a case number and instructions on returning the money. Both of these kinds of calls are not from the IRS but from those performing the hack and following scam. Don’t return these calls, ignore them right off.
Funds sent from the IRS in error can be returned to a mailing address provided by the IRS on their website if this ever actually happens. Take a look at 2018 Tax Topic #161 on the IRS website.
If you happen to experience this most recent IRS Refund Scam, discuss the situation with your bank as closing the account might be in order.
Finally, a phone call to your tax preparer would be advisable to discuss what you should do with erroneously deposited tax refunds. You’ll have to work with the IRS also to file your real return for the year and get identity protection in the future.
The H and R Block Budget Challenge is an online simulated experience tool available to educators. The program, which seems like a game to most young adults which they really like, and portrays the financial pressures of adulthood. Although the Budget Challenge is available year-round, it holds special importance this April, which is National Financial Literacy Month in America. To celebrate the holiday, the financial software and planning company H And R Block will award over $1.3 million in scholarship money to Budget Challenge participants. Make sure to apply as soon as you can.
Photo by vthokiejd National Financial Literacy Month
According to the Council for Economic Education, financial literacy classes are only required for high school graduation in seven states. This might explain why H And R Block has discovered that 58 percent of teens worry that they will experience more financial hardship than their parents have. Unfortunately, there are few outlets from which teenagers can get sound financial information. There is a great need for programs like this one by H&R Block.
The H and R Block Budget Challenge works to change this fact. The platform offers real world financial education to 155,000 high school students across every state during National Financial Literacy Month. Over the month of April, H And R Block will monitor the top Budget Challenge performers and award them with scholarships for higher education. Students who do not win a scholarship will still see improvement in their financial confidence through the program. Over 95 percent of participating educators attest to the effectiveness of the Budget Challenge in teaching teens financial literacy. Hopefully your young student will learn a lot of participating this year.
The New Steps TurboTax and H&R Block are taking to keep you safe this tax season should help you avoid tax identity theft. Taxpayers are planning to get their finances organized in time for the April 18 filing deadline. Unfortunately, tax security theft is causing a challenge. Identity thieves are also planning to file fraudulent returns.
For many years, phony tax returns have been a critical challenge for the Internal Revenue Service. According to the Government Accountability Office, IRS provides that it issued approximately $5.8 tax year in fraudulent tax refunds in 2013 alone. A 2012 approximation from the Treasury Inspector General for Tax Administration also established that due to identity theft over the subsequent five years, IRS could issue $21 billion in potentially fraudulent tax returns. Recent high-profile cyber security incidents have kept taxpayer on the edge.
New guidelines are in place to sort out this problem. H&R Block and Intuit and other companies will share more data with the government to try to identify and rule out suspicious returns.
Tax filing companies will also enhance and add security features this year. The guidelines require passwords to have more complex combinations of characters. Users who exceed a specific number of failed login attempts will be locked out. Companies will use a two-factor authentication to help reduce the security breaches.
Some of these features are not new to tax prep software. Nonetheless, some firms are changing how they operate. TurboTax now allows users to turn on two-factor authentication each time they log in the service. Hackers often rely on knowledge of the victim’s personal life to trick companies to given them targets’ login details by answering security questions. According to Intuit Vice President Julie Miller, Turbo and other software will actively notify users whenever changes are made to their accounts so as to sort out this threat and others.
H&R Block’s Ciaramitaro says the company will aggressively send more and new data to the government than it has done in the past to solve the tax identity theft problem caused by using outdated systems that identity thieves have mastered to outwit easily.
The Internal Revenue Service announced on 30th October, 2014 that there was an annual inflation in the United States of America and they made more than 40 adjustments on the tax provisions. The following 2015 tax changes have been outlined on the Revenue Procedure 2014-61. If you unsure how to file your taxes with these new changes, consider using a tax program like TaxAct 2014.
According to the Internal Revenue Service, 39.6% of the new tax rate affects unmarried individuals whose income is more than $413,200 as well as married couples whose income exceeds $413,200. In addition to this, the standard deduction for the unmarried will rise to $6,300 while for the married couples whose returns are not the same will rise to $12,600. On the other hand, standard deduction for married couples who fill the same returns will have their standard deduction rise from $6,200 to $12,400. On the same note, each household head will have his/her standard deduction increased from $9.250 to $9,100.
When it comes to personal exemption, as compared to $3,950 that was for the year 2014 it will be expected that in 2015 this will rise to $4,000. However, this will not be realized at once and it will be subjected to a number of phases starting from $258,250 for the unmarried and $309,900 for married couples who fill the same tax returns. The last phase will be $380,750 for the unmarried and $432,400 for couples who are married and they fill the same tax returns.
In terms of the Alternative Minimum Tax exemption, it will be $53,600 for the unmarried and $83,400 for married couples filling the same tax returns for the year 2015. This shows that there is a significant increase as compared to 2014 which was $52,800 for the unmarried and $82,100 for the married couples filling the same tax returns. The Alternative Maximum Earned Income Credit for the year 2015 will be $6,242 for tax payers with more than three children. This is a significant increase as compared to the year 2014 whereby the Alternative Maximum Earned Income Credit was $6,143 for taxpayers with more than three children.
Furthermore as compared to 2014 whereby Estates of Decedents who died were given a basic exclusion of $5,340,000 this basic exclusion for Estates of Decedents who will die in 2014 fiscal year will be increased to $5,430,000. In addition to this, the exclusion from tax on a gift for non-US spouse will be increased from $145,000 (2014) to $147,000 in the year 2015. In addition to this, $99,200 foreign earned income exclusion for the year 2014 will rise significantly in 2015 to $100,800. Furthermore, the maximum credit will be phased out depending on the number of full-time employees. Lastly, the annual dollar limit of employee contribution to Flexible Spending Arrangements will rise from $50 to $2,550 in 2015 fiscal year.
