Anthony Sykes & Company

       The Internal Revenue Service ( IRS ) has finished issuing the third round of Economic Impact Payments ( EIP ). This means that if you qualified, but did not receive the full amount, you must claim the 2021 Recovery Rebate Credit on your tax return. This also applies to those who do not normally file a tax return. Families that added a new dependent in 2021 may be eligible for a greater amount.      The IRS will send a letter confirming what was sent in 2021, so taxpayers must carefully look at the information and determine what amount, if anything, they can claim as a credit. Doing this will help avoid processing delays. Careful review is needed in this matter. Having a Qualified Tax Professional would be helpful.

                 While most people do, there are some who do not normally file a tax return. There are good reasons to check and see if you should file this year. For example, to claim any tax credit like the Child Tax Credit or the Earned Income Tax Credit ( EITC ) a tax return must be filed. This will determine if the taxpayer qualifies.           Something that is still relatively new is the Recovery rebate credit. This is a result of the Economic Impact Payments. If you qualified but did not receive your third stimulus payment last year, it can be claimed as a credit. This can only happen if you file a tax return and provide your income for 2021. This credit can reduce any taxes that you might owe, or it will be included in your total refund.

                 We now know that the filing season for 2022 will officially start in less than 2 weeks. What can we expect? We should be prepared for many challenges and frustrations, delays and difficulties. Why?           For one reason, it is no secret that the Internal Revenue Service ( IRS ) has had customer service issues and shortages for years. For example, last tax season the IRS was only able to answer about 10% of phone calls. That is not expected to improve. In fact, things can get worse due to budget cuts related to the current pandemic. They are also still to trying deal with some requirements like processing Economic Impact Payments ( EIP ) and advanced child tax credits.           As of November, the IRS still had almost 9 million tax returns left to process. That backlog is far greater than a normal year. It usually takes 3 w...

             It is now official that the Internal Revenue Service ( IRS ) will begin to accept and process tax returns on January 24, 2022 . To make this tax season go as smoothly as possible, it is strongly recommended that Taxpayers have all of their documents gathered ahead of time. This will allow them to file a complete return the first time and avoid processing delays.           Your Qualified Tax Professional can help you determine what documents are needed. With the stimulus and child credit payments in 2021, there is a greater need for keeping good records than before. Another important note is that the deadline for filing an individual tax return is April 18,  2022,  because Emancipation Day is observed in Washington D.C.

           With each new year, the Internal Revenue Service ( IRS ) makes changes to the tax law, and 2022 will be no different. Now is the time to get informed about these adjustments.           Economic Impact Payments have been a part of our lives for 2 years. However, some may not have received all of their third payment. A taxpayer in this situation may be eligible for the recovery rebate credit . They would need to file a 2021 tax return to determine how much they could claim. It is also necessary to use the records you already have regarding your previous stimulus payments. Keeping good records is always important.           When it comes to Child Tax Credits , many families got monthly advance payments. If the total was less than they were eligible for, the balance can be claimed on their tax return. If there were no advance payments, the entire amount can ...

             The last day to file a California state personal income tax return on an extension is Friday, October 15. Anything after that will be considered late by the Franchise Tax Board ( FTB ). Filing on time will avoid penalties, and potentially allow you to qualify for Golden State Stimulus ( GSS ) payments. If you do not file income taxes for 2020, you cannot qualify.           If you have income of less than $75,000 for 2020, you can qualify for a GSS payment. In addition, the taxpayer cannot be claimed as a dependent and must be a resident of California when the payment is issued. They also must have spent at least half of 2020 in the state of California. If you have provided bank account information to the FTB , you can expect an electronic deposit. Otherwise, the payment will be sent by mail. It is estimated that half a million tax returns still need to be filed. If you have not done so a...