tax-refund-check

IRS Holding $153 Million in Undelivered Tax Return Checks

Are you missing yours?

WASHINGTON — In an annual reminder to taxpayers, the Internal Revenue Service announced today that it is looking to return $153.3 million in undelivered tax refund checks. In all, 99,123 taxpayers are due refund checks this year that could not be delivered because of mailing address errors.

Undelivered refund checks average $1,547 this year.

Taxpayers who believe their refund check may have been returned to the IRS as undelivered should use the “Where’s my refund?” tool on IRS.gov. The tool will provide the status of their refund and, in some cases, instructions on how to resolve delivery problems.

Taxpayers checking on a refund over the phone will receive instructions on how to update their addresses. Taxpayers can access a telephone version of “Where’s My Refund?” by calling 1-800-829-1954.

 

IRS Holding $153 Million in Undelivered Tax Return Checks

While only a small percentage of checks mailed out by the IRS are returned as undelivered, taxpayers can put an end to lost, stolen or undelivered checks by choosing direct deposit when they file either paper or electronic returns. Last year, more than 78.4 million taxpayers chose to receive their refund through direct deposit. Taxpayers can receive refunds directly into their bank account, split a tax refund into two or three financial accounts or even buy a savings bond.

The IRS also recommends that taxpayers file their tax returns electronically, because e-file eliminates the risk of lost paper returns. E-file also reduces errors on tax returns and speeds up refunds. Nearly 8 out of 10 taxpayers chose e-file last year. E-file combined with direct deposit is the best option for taxpayers to avoid refund problems; it’s easy, fast and safe.

The public should be aware that the IRS does not contact taxpayers by e-mail to alert them of pending refunds and does not ask for personal or financial information through email.  Such messages are common phishing scams.  The agency urges taxpayers receiving such messages not to release any personal information, reply, open any attachments or click on any links to avoid malicious code that can infect their computers.  The best way for an individual to verify if she or he has a pending refund is going directly to IRS.gov and using the “Where’s My Refund?” tool.

college tax benefits

Two Out of Three Individuals Now Using e-File

Individuals e-filed a record 95 million federal income tax returns during 2009, up almost 6 percent from last year’s total of nearly 90 million. About two out of three taxpayers used e-file this year; out of the 141 million returns filed so far this year, over 67 percent were e-filed, compared to 59 percent last year.

 

Two Out of Three Individuals Now Using e-File

Each year, more taxpayers chose to e-file their tax returns. While the total number of tax returns has increased 10 percent during the past decade, the number filed electronically has increased by 168 percent. Taxpayers who e-file from a home computer continue to be an increasingly significant segment of those who e-file.

 

Year Filed Total Returns e-Filed Returns Percent e-filed
2000 128,430,000 35,412,000 27.57%
2001 130,965,000 40,244,000 30.73%
2002 131,728,000 46,892,000 35.60%
2003 131,557,000 52,944,000 40.24%
2004 132,200,000 61,507,000 46.53%
2005 133,933,000 68,476,000 51.13%
2006 136,071,000 73,255,000 53.84%
2007 140,188,000 79,979,000 57.05%
2008 153,650,000 89,853,000 58.48%
2009 141,376,000 94,980,000 67.18%

Home Computer e-Filers

couplecomputer

This year, for the first time, more than a third of e-filers are filing their returns themselves from a home computer. More than 32 million returns were e-filed from home computers, up almost 20 percent from last year’s record of 27 million. People filing from their home computers account for about 34 percent of all e-filed returns from individuals.

 

Direct Deposit Refunds

Almost 73 million refunds were electronically deposited into taxpayer’s accounts, saving the government mailing costs and saving taxpayers a trip to the bank. More importantly, these taxpayers received their refunds at least a week sooner than those receiving a paper check.

These direct deposit refunds accounted for 66 percent of all refunds, up from 62 percent of refunds last year. Overall, the IRS issued 110 million refunds, averaging $2,753 per refund; direct deposit refunds averaged $2,997 per refund.

 

IRS Free File

More than 3 million taxpayers filed their tax returns for free through the IRS Free File program.

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Tax Tips for Recently Married Taxpayers

Few changes in life affect your taxes as significantly as beginning or ending a marriage. These Q&As may be helpful if you have been recently married or divorced. In most cases, you pay less tax by filing jointly. You do not qualify for certain tax breaks, or your tax breaks may be limited, if you use the Married Filing Separately filing status. For example, you cannot take education credits, the student loan interest deduction, or the rental real estate loss allowance if you lived together and file separately. Also, you cannot take the Child and Dependent Care Credit or the Adoption Credit if you file separately, unless you lived apart for the last six months of the year.

Tax Tips for Recently Married Taxpayers

Married Filing Separately (MFS) taxpayers are only responsible for their income and taxes (and not for a spouse), but may not be eligible to claim the following tax benefits:

  • Tuition and fees deduction
  • Student loan interest deduction
  • Tax-free exclusion of US bond interest
  • Tax-free exclusion of Social Security Benefits
  • Credit for the Elderly and Disabled
  • Child and Dependent Care Credit
  • Earned Income Credit
  • Education Credits

 

Other drawbacks of Married Filing Separately:

  • Taxpayers have a much lower income phase-out range for IRA deductions.
  • Both spouses must claim the standard deduction, or both must itemize their deductions. One spouse cannot claim the standard deduction if the other is itemizing.
  • This filing status generally pays the most tax of all the filing statuses.

If you have recently gotten married or plan to get married in the near future, the IRS has some tips to help you avoid stress at tax time.

bride

  1. Notify the Social Security Administration: Report any name change to the Social Security Administration, so your name and SSN will match when you file your next tax return. Informing the SSA of a name change is quite simple. File a Form SS-5, Application for a Social Security card at your local SSA office. The form is available on SSA’s Web site at www.socialsecurity.gov, by calling 800-772-1213 or at local offices.
  2. Notify the IRS: If you have a new address you should notify the IRS by sending Form 8822, Change of Address. You may download Form 8822 below or order it by calling 800–TAX–FORM (800–829–3676).
  3. Notify the U.S. Postal Service: You should also notify the U.S. Postal Service when you move so it can forward any IRS correspondence.
  4. Notify Your Employer: Report any name and address changes to your employer(s) to ensure receipt of your Form W-2, Wage and Tax Statement after the end of the year.
  5. Check Your Withholding: If both you and your spouse work, your combined income may place you in a higher tax bracket. You can use the IRS Withholding Calculator available on IRS.gov to assist you in determining the correct amount of withholding needed for your new filing status. The IRS Withholding Calculator will even provide you with a new Form W-4, Employee’s Withholding Allowance Certificate you can print out and give it to your employer so they can withhold the correct amount from your pay.

Bottom line: planning for your wedding may be over, but don’t forget about planning for the tax-related changes that marriage brings. More information about changing your name, address and income tax withholding is available on IRS.gov. IRS forms and publications can be obtained from IRS.gov or by calling 800-TAX-FORM (800-829-3676).

 

Additional IRS Links on the Tax Consequences of Getting Married:

 

YouTube Video on Getting Married and Taxes:

Top 10 Tips for Last Minute Tax Filers

With the tax filing deadline close at hand, here are the top 10 tips for last minute taxpayers still working on their tax return. Sometimes the most frustrating part of preparing your tax return is dealing with unsuccessful attempts to e-file. E-filing your return instead of mailing definitely has some benefits, especially receiving your refund much faster. The Internal Revenue Service can reject your e-filing for a wide range of reasons, which means you’ll need to figure out what went wrong and try again. However, if you implement some basic tips, you may be able to avoid unnecessary e-file rejections.

 

Top 10 Tips for Last Minute Tax Filers

efile Tax Tips

  1. E-file your return. Consider filing electronically instead of using paper tax forms. Choosing to e-file is the best way to ensure your return is accurate and complete.
  2. Review tax ID numbers. Remember to carefully check all identification numbers on your return. Incorrect or illegible Social Security Numbers can delay or reduce a tax refund.
  3. Double-check your figures. Whether you are filing electronically or by paper, review all the amounts you transferred over from your W-2 or 1099.
  4. Review your math. Taxpayers filing paper returns should also double-check that they have correctly figured the refund or balance due and have used the right figure from the tax table.
  5. Sign and date your return. Both spouses must sign a joint return, even if only one had income. Anyone paid to prepare a return must also sign it.
  6. Choose Direct Deposit. To get your refund quicker, select Direct Deposit and the IRS will deposit your refund directly into your bank account.
  7. How to make a payment. People sending a payment should make the check out to “United States Treasury” and should enclose it with, but not attach it to the tax return or the Form 1040-V, Payment Voucher, if used. Write your name, address, SSN, telephone number, tax year and form number on the check or money order.
  8. File an extension. Taxpayers who will not be able to file a return by the April deadline should request an extension of time to file. Remember, the extension of time to file is not an extension of time to pay.
  9. Visit the IRS Web site. IRS.gov has forms, publications and helpful information on a variety of tax subjects, which is available around the clock on the IRS.gov.
  10. Review your return….one more time. Before you seal the envelope or hit send, go over all the information on return again. Errors may delay the processing of your return, so it’s best for you to make sure everything on your return is correct.

 

Common eFile Errors Lead to Rejections

One of the easier e-file rejections to fix is the names reported on your tax forms. When you e-file, the IRS will check to ensure that your name matches the Social Security number (SSN) reported on the form. Another frequent mismatch occurs when there is a name change due to marriage or divorce. If you change your last name, you need to notify the Social Security Administration to get your SSN reassigned to your new name, or risk your e-file being rejected. When you take exemptions for your dependents, your tax form requires their full names, SSNs and the relationship you have with each of them. The IRS e-file system will verify that each dependent’s name matches the corresponding SSN by comparing the information to IRS master files. If it doesn’t match, the IRS will reject your e-filing.

Further, certain tax return filing statuses require additional information on the return other than just marking the appropriate status box. If filing as head of household, for example, one of the eligibility requirements is that you claim at least one dependent on your return. Thus, if you forget to list your dependent or report your dependent’s name or SSN incorrectly, the e-filing system will catch this error and reject your e-file submission

 

Additional IRS Links on eFile:

Form 9465, Installment Agreement Request
Form 1040-V, Payment Voucher
Form 4868, Application for Automatic Extension of Time to File U.S. Individual Income Tax Return

Alternative Minimum Tax (AMT) Processeing

IRS Successfully Processing Tax Forms Affected by AMT Legislation

WASHINGTON — The Internal Revenue Service is now processing the five tax forms affected by legislation involving the Alternative Minimum Tax (AMT).

On Monday, IRS systems began to accept and process returns that include the five affected forms. After several days of processing, the IRS has confirmed all systems are working properly.

In late December, the IRS announced it would delay processing of several tax forms. For the vast majority of taxpayers, the filing season this year began on time. But for any taxpayer whose return included any of the five affected forms, filing opened on Feb. 11.

 

Alternative Minimum Tax (AMT) Processing

Taxpayers who use the five forms can now file their tax returns as normal.

The affected forms are:

  • Form 8863, Education Credits
  • Form 5695, Residential Energy Credits
  • Schedule 2, Form 1040A, Child and Dependent Care Expenses for Form 1040A Filers;
  • Form 8396, Mortgage Interest Credit
  • Form 8859, District of Columbia First-Time Homebuyer Credit

Approximately 13.5 million taxpayers will use these forms this year. Altogether, the IRS expects to receive nearly 140 million individual tax return submissions this year.

The IRS has worked closely with the software industry and tax practitioners during the reprogramming process to minimize disruptions for taxpayers and the tax community.

If you haven’t filed your taxes yet, get started now using our online tax preparation system.

Tax Returns from Seven States Go to Different IRS Tax Centers

As some taxpayers begin to prepare their paper tax returns, the Internal Revenue Service notes that some may be sending their returns to a different service center than last year. Those who received a tax instruction booklet from the IRS in the mail and use the labels included with the booklet can be assured that their tax returns will go to the correct address. Taxpayers who e-file are not affected by these changes.

For tax year 2007, the mailing changes affect returns, with or without payments, from these seven states:
Iowa, Kansas, Kentucky, Oklahoma, Pennsylvania, West Virginia, and Wisconsin.

Tax Returns from Seven States Go to Different IRS Tax Centers

 

Taxpayers from these seven states should send:

  • Returns from Iowa, Kansas, Oklahoma and Wisconsin to the IRS center in Fresno, California.
  • Returns from Kentucky to the IRS center in Austin, Texas.
  • Returns from Pennsylvania and West Virginia to the IRS center in Kansas City, Missouri.

For taxpayers who file paper returns, the correct center addresses are on labels inside the tax packages they receive in the mail. Taxpayers who do not receive a package should refer to the back cover of the instructions on Forms 1040, 1040A or 1040EZ.

Taxpayers who e-file will not be affected by these changes. Last year, 57 percent of all individual income tax filers chose to e-file their tax returns.

Even those who normally don’t have to file a federal tax return will have to file one this year in order to claim the economic stimulus payment. The tax return should be sent to the following special address (people who normally file a return each year should use the regular IRS mailing addresses contained in the Form 1040 instructions):

 

  IF you live in…

  THEN use this address:             

Alabama, Delaware, Florida, Georgia,
North Carolina, Rhode Island, South
Carolina, Virginia
Department of the Treasury
Internal Revenue Service Center
Atlanta, GA 39901-0099
District of Columbia, Maine, Maryland,
Massachusetts, New Hampshire,
New York, Vermont
Department of the Treasury
Internal Revenue Service Center
Andover, MA 05501-0099
Arkansas, Connecticut, Illinois, Indiana,
Michigan, Missouri, New Jersey, Ohio,
Pennsylvania, West Virginia
Department of the Treasury
Internal Revenue Service Center
Kansas City, MO 64999-0099
Kentucky, Louisiana, Mississippi, Tennessee,
Texas, APO, FPO
Department of the Treasury
Internal Revenue Service Center
Austin, TX 73301-0099
Alaska, Arizona, California, Colorado, Hawaii,
Idaho, Iowa, Kansas, Minnesota, Montana,
Nebraska, Nevada, New Mexico, North
Dakota, Oklahoma, Oregon, South Dakota,
Utah, Washington, Wisconsin, Wyoming
Department of the Treasury
Internal Revenue Service Center
Fresno, CA 93888-0099
Page Last Reviewed or Updated: 28-Apr-2014