Reminder: Employers Must File Forms W-2 by Jan. 31 This Year

WASHINGTON ― The Internal Revenue Service today reminds employers that the due date for filing Forms W-2, the Wage and Tax Statement for their employees for calendar year 2016, is now Jan, 31, 2017. Also, those who hire contract workers and have to file Form 1099-MISC now must file by Jan. 31.

The new deadline applies whether an employer e-files or files a paper Form W-2. Employers who pay an employee $600 or more for the year must file a Form W-2 for each employee with the Social Security Administration.

The new deadline is part of legislation signed into law at the end of 2015 to combat identity-theft related refund fraud.

The Social Security Administration encourages all employers to e-file their Forms W-2 by using its Business Services Online.  Employers who file paper Forms W-2 should file them with the Social Security Administration, Data Operations Center, Wilkes-Barre, PA 18769-0001.

E-filing can save time and effort and helps ensure accuracy. Employers must e-file if they file 250 or more Forms W-2 or W-2c. Employers who are required to e-file but fail to do so may incur a penalty. E-filing can save time and effort and helps ensure accuracy.

The IRS projects that employers will file more than 250 million Forms W-2 this year; the vast majority will be e-filed.

The new rule does not affect the filing deadline for other types of Form 1099 or Forms 1097, 1098, 3921, 3922, or W-2G, which are filed on paper by Feb. 28, 2018, or by April 2, 2018 if filed electronically.

Things to Remember When Choosing a Tax Preparer

Taxpayers should choose their tax return preparer wisely – with good reason. Taxpayers are responsible for all the information on their income tax return. That’s true no matter who prepares the return. Here are ten tax tips to keep in mind:

1. Check the Preparer’s Qualifications. Use the IRS Directory of Federal Tax Return Preparers with Credentials and Select Qualifications. This tool helps taxpayers find a tax return preparer with the qualifications that they prefer. The Directory is a searchable and sortable listing of preparers with a credentials or filing season qualifications. It includes the name, city, state and zip code of:

  • Attorneys.
  • Certified Public Accountants.
  • Enrolled Agents.
  • Enrolled Retirement Plan Agents.
  • Enrolled Actuaries.
  • Annual Filing Season Program participants.

Attorneys, CPAs and enrolled agents can represent any client before the IRS in any situation. Annual Filing Season Program participants may represent clients in more limited situations. Non-credentialed preparers who do not participate in the Annual Filing Season Program may only represent clients before the IRS on returns they prepared and signed on or before December 31, 2015.

For more information, check the Understanding Tax Return Preparer Credentials and Qualifications page.

2. Check the Preparer’s History. Ask the Better Business Bureau about the preparer. Check for disciplinary actions and the license status for credentialed preparers. For CPAs, check with the State Board of Accountancy. For attorneys, check with the State Bar Association. For Enrolled Agents, go to IRS.gov and search for “verify enrolled agent status” or check the Directory.

3. Ask about Service Fees. Avoid preparers who base fees on a percentage of the refund or who boast bigger refunds than their competition. When inquiring about a preparer’s services and fees, don’t give them tax documents, Social Security numbers and other information. Some preparers have improperly used this information to file returns without the taxpayer’s permission.

4. Ask to E-file. Taxpayers should make sure their preparer offers IRS e-file. Paid preparers who do taxes for more than 10 clients generally must file electronically. The IRS has safely processed billions of e-filed tax returns.

5. Make Sure the Preparer is Available. Taxpayers may want to contact their preparer after this year’s April 18 due date. Avoid fly-by-night preparers.

6. Provide Records and Receipts. Good preparers will ask to see a taxpayer’s records and receipts. They’ll ask questions to figure the total income, tax deductions, credits, etc. Taxpayers should not use a preparer who will e-file their return using their last pay stub instead of a Form W-2. This is against IRS e-file rules.

7. Never Sign a Blank Return. Don’t use a tax preparer who asks a taxpayer to sign a blank tax form.

8. Review Before Signing. Before signing a tax return, review it. Ask questions if something is not clear. Taxpayers should feel comfortable with the accuracy of their return before they sign it. They should also make sure that their refund goes directly to them – not to the preparer’s bank account. Review the routing and bank account number on the completed return.

9. Ensure the Preparer Signs and Includes Their PTIN. All paid tax preparers must have a Preparer Tax Identification Number (PTIN). By law, paid preparers must sign returns and include their PTIN.

10. Report Abusive Tax Preparers to the IRS. Most tax return preparers are honest and provide great service to their clients. However, some preparers are dishonest. Report abusive tax preparers and suspected tax fraud to the IRS. Use Form 14157, Complaint: Tax Return Preparer. If a taxpayer suspects a tax preparer filed or changed their return without the taxpayer’s consent, they should file Form 14157-A, Return Preparer Fraud or Misconduct Affidavit. Taxpayers can get these forms on IRS.gov any time.

Taxpayers should keep a copy of their tax return. Beginning in 2017, taxpayers using a software product for the first time may need their Adjusted Gross Income (AGI) amount from their prior-year tax return to verify their identity. Taxpayers can learn more about how to verify their identity and electronically sign tax returns at Validating Your Electronically Filed Tax Return.

Additional IRS Resources:

IRS YouTube Videos:

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Claim the Earned Income Tax Credit

The Earned Income Tax Credit has helped workers with low and moderate incomes get a tax break for 40 plus years. Yet, one out of every five eligible workers fails to claim it. Here are some things taxpayers should know about the EITC:

  • Review Your Eligibility. Taxpayers who worked and earned under $53,505 may qualify for EITC. Filers should review EITC eligibility rules if their household income or family situation has changed. They may qualify for EITC this year, even if they did not in the past. To qualify, a taxpayer must file a federal income tax return claiming the Earned Income Tax Credit.  This is true even if a taxpayer is not otherwise required to file a tax return. Use the EITC Assistant tool to find out about eligibility rules and amounts.
  • Know the Rules. Taxpayers need to understand the rules before they claim the EITC. It is important to get this right. Here are some factors to consider:
    • Taxpayers who are married and file a separate return do not qualify for the EITC.
    • Filers must have a Social Security number valid for employment for themselves, their spouse (if married), and any qualifying child listed on their filed tax return.
    • Taxpayers must have earned income. This may include earnings from working for someone else as an employee or being self-employed.
    • Filers may be married or single, with or without children to qualify. Those who do not have children must also meet the age, residency and dependency rules. For a child to qualify, they must have lived with the taxpayer for more than six months in 2016. In addition, the child must meet the age, residency, relationship and joint return rules to qualify.
    • U.S. Armed Forces members serving in a combat zone have special rules that apply.
  • Lower Your Tax or Get a Refund. Filers who qualify for EITC could pay less federal tax, no tax or even get a refund. The EITC could be worth up to $6,269. The average credit was $2,482 last year.
  • Use Free Services. For those who do their own taxes, the best way to file a return to claim EITC is to use IRS Free File. Free brand name software will figure out taxes and the EITC automatically. Combining e-file with direct deposit is the fastest and safest way to get a refund. Free File is only available on IRS.gov/freefile.

Taxpayers can also get free help preparing and e-filing their return to claim the EITC. The IRS Volunteer Income Tax Assistance, or VITA program, offers free help at thousands of sites around the country. Get help with health care law tax provisions with Free File or VITA.

  • Refunds Held Until Feb 15. Beginning in 2017, if taxpayers claim the Earned Income Tax Credit or Additional Child Tax Credit on their tax return, the IRS must hold their refund until at least February 15. This applies to the entire refund, even the portion not associated with these credits. However, the IRS will begin accepting and processing tax returns once the filing season begins. Taxpayers should file as usual. There is no need to wait until February 15.

For more on EITC, see IRS Publication 596, Earned Income Credit. It’s available in English and Spanish on IRS.gov.

Taxpayers should keep an eye out for IRS EITC Awareness Day. Look for promotional information and locally scheduled events on or around January 27, 2017.

All taxpayers should keep a copy of their tax return. Beginning in 2017, taxpayers using a software product for the first time may need their Adjusted Gross Income (AGI) amount from their prior-year tax return to verify their identity. Taxpayers can learn more about how to verify their identity and electronically sign tax returns at Validating Your Electronically Filed Tax Return.

Additional IRS Resources:

IRS YouTube Videos:

EITC Awareness Day: Workers May Qualify for Significant Tax Benefit

WASHINGTON — The Internal Revenue Service today joined partners across the country in promoting the Earned Income Tax Credit on EITC Awareness Day, Friday, Jan. 27, 2017. This campaign, which started 11 years ago, is a nationwide effort to alert millions of low- and moderate-income workers who may be missing out on this significant tax credit.

Millions of taxpayers who earned $53,505 or less last year may qualify for EITC for the first time in 2017, making awareness critical. Local officials and community organizations nationwide are holding events on EITC Awareness Day highlighting this key benefit.

“The EITC is an important anti-poverty tax credit that helps millions of people every year,” said IRS Commissioner John Koskinen. “Even though four out of five eligible workers and families benefit from the EITC, millions more miss out because they don’t know about it or don’t realize they’re eligible. We encourage people to look into whether they qualify.”

Workers, self-employed people and farmers who earned $53,505 or less last year could receive larger refunds if they qualify for the EITC. Eligible families with three or more qualifying children could get a maximum credit of up to $6,269. EITC for people without children could mean up to $506 added to their tax refund. Unlike most deductions and credits, the EITC is refundable. In other words, those eligible may get a refund from the IRS even if they owe no tax. Last year, more than 27 million eligible workers and families received almost $67 billion in EITC; with an average EITC amount of more than $2,455.

The IRS recommends that all workers who earned around $54,000 or less learn about EITC eligibility and use the EITC Assistant to find out if they qualify. The tool will help them determine their filing status, if they have a qualifying child or children, if they qualify to receive the EITC and estimate the amount of the credit they could get. If an individual doesn’t qualify for EITC, the Assistant explains why. A summary of the results can be printed and kept with the worker’s tax papers.

The IRS reminds taxpayers to be sure they have valid Social Security numbers in hand for themselves, as well as for each qualifying child, before they file their return. Moreover, to get the EITC on a 2016 return, they must get these SSNs before the tax-filing deadline (April 18, 2017, for most people or Oct. 16, 2017, for those who get extensions).

How to Claim the EITC

To get the EITC, workers must file a tax return and specifically claim the credit. Free tax preparation help is available online and through a nearby volunteer organization. Those eligible for the EITC have these options:

  • Free File on IRS.gov. Free brand-name tax software walks people through a question and answer format to help them prepare their returns and claim every credit and deduction for which they are eligible. Free File also provides online versions of IRS paper forms, an option called Free File Fillable Forms, best suited for taxpayers comfortable preparing their own returns.
  • Free tax preparation sites. EITC-eligible workers can seek free tax preparation at thousands of Volunteer Income Tax Assistance (VITA) and Tax Counseling for the Elderly (TCE) sites. To locate the nearest site, use the search tool on IRS.gov or the IRS2go smartphone application.

Be sure to bring along all required documents and information.

Refunds

A new law approved by Congress requires the IRS to hold refunds claiming the EITC and the Additional Child Tax Credit (ACTC) until Feb. 15. By law, the IRS must hold the entire refund — even the portion not associated with EITC or ACTC. This change helps ensure taxpayers receive the refund they are owed by giving the agency more time to help detect and prevent fraud.

Even so, taxpayers can still get their refunds sooner by choosing direct deposit. The IRS will begin releasing these refunds on Feb. 15, but taxpayers should not expect to see them deposited into their bank accounts until the week of Feb. 27– assuming there are no processing issues with the tax return.

Where’s My Refund? ‎on IRS.gov and the IRS2Go mobile app will be updated with projected deposit dates for early EITC / ACTC refund filers a few days after Feb. 15.

Avoid Errors: Get It Right

Taxpayers are responsible for the accuracy of their tax return even if someone else prepares it for them. Since the EITC rules are complicated, the IRS urges taxpayers to seek help if they are not sure they are eligible, at a free tax return preparation site, by using Free File software, or from a paid tax professional. Be sure to choose a tax preparer wisely. Deliberate errors can have lasting impact on future eligibility to claim EITC and leave taxpayers with a penalty.

Be sure to reply promptly to any letter from the IRS requesting additional information about EITC. If taxpayers need assistance or have questions, call the number on the IRS letter.

The IRS also reminds taxpayers about the availability of myRA, a free, retirement savings account from the Treasury Department. Taxpayers who have a myRA account may use Free File to deposit their tax refund or a portion of their refund into their myRA account. Use Form 8888 or follow the software product’s instructions.

Beware of Scams

Beware of scams that claim to increase the EITC refund. Scams that create fictitious qualifying children or inflate income levels to get the maximum EITC could leave taxpayers with a penalty.

Normally, if an EITC claim was reduced or denied in the past any reason other than a mathematical or clerical error, taxpayers must file Form 8862, Information to Claim Earned Income Credit after Disallowance, with their next return to claim the credit.

IRS.gov is a valuable first stop to help taxpayers get it right this filing season. Qualify for EITC? See what other tax credits are available such as the Additional Child Tax Credit.

Related items:

  • FS-2017-02, Do I Qualify for the Earned Income Tax Credit?
  • IRS.gov/eitc, Detailed EITC eligibility rules
  • EITC Central at www.eitc.irs.gov, Helpful resources for IRS partners and anyone interested in spreading the word about this benefit.
  • Pub. 596, Earned Income Credit (EIC)
  • Tax Professionals, Another place for valuable EITC resources and assistance.

Use IRS Free File to File Taxes for Free

Join the millions of Americans who safely file their taxes and save money using IRS Free File. Taxpayers can use either name-brand software or fillable forms – for free. Combining IRS Free File with direct deposit is the quickest and safest way to get a refund.

Here are some tips about IRS Free File:

  1. Get Started at IRS.gov. IRS Free File is available only through IRS.gov. Simply choose a Free File company and then click on that link to prepare and e-file the return.
  2. Find Tax Breaks. The tax software’s question-and-answer format helps eligible taxpayers find tax breaks. This could include tax credits such as the Earned Income Tax Credit. The software then selects the appropriate tax forms and does the calculations automatically. Free File can help with the health care law tax provisions as well.
  3. Free for All. Taxpayers with income of $64,000 or less can use brand-name software. Taxpayers who earned more can use Free File Fillable Forms. This option allows taxpayers to complete IRS forms electronically. It is best for those who are used to doing their own taxes.
  4. Easy Online Extensions. For those who cannot finish their return by the April 18 deadline, it’s easy to use Free File to request a six-month extension. An extension of time to file is not an extension of time to pay. If taxpayers owe federal taxes, they should estimate the amount they owe and pay it with the extension request. This will help avoid penalties and interest.

The IRS partners with leading tax software companies, the Free File Alliance, to make the program available. Some companies offer free state tax return filing as well.

All taxpayers should keep a copy of their tax return. Beginning in 2017, taxpayers using a software product for the first time may need their Adjusted Gross Income (AGI) amount from their prior-year tax return to verify their identity. Taxpayers can learn more about how to verify their identity and electronically sign tax returns at Validating Your Electronically Filed Tax Return.

IRS YouTube Videos:

Five Reasons to Choose Direct Deposit For Your Tax Refund

Easy, safe and fast — that’s direct deposit. It’s the best way to get a tax refund. Eighty percent of taxpayers choose it every year. The IRS knows taxpayers have a choice of how to receive their refunds.

IRS Direct Deposit:

  1. Is Fast. The quickest way for taxpayers to get their refund is to electronically file their federal tax return and use direct deposit. Use IRS Free File to prepare and e-file federal returns for free. Use direct deposit for paper tax returns, too.
  2. Is Secure. Since refunds go right into a bank account, there’s no risk of having a paper check stolen or lost in the mail. This is the same electronic transfer system used to deposit nearly 98 percent of all Social Security and Veterans Affairs benefits into millions of accounts.
  3. Is Convenient. There’s no need to wait for a refund check to come in the mail.
  4. Is Easy.  Choosing direct deposit is easy. With e-file, just follow the instructions in the tax software. For paper returns, the tax form instructions serve as a guide. Make sure to enter the correct bank account and routing number.
  5. Has Options. Taxpayers can split a refund into several financial accounts. These include checking, savings, health, education and certain retirement accounts. The U.S. Treasury Department offers a retirement account. It’s called a MyRA account.  Designate all or a part of a refund to a new MyRA account. Simply mark the “savings” box in the refund section of the return. Use IRS Form 8888, Allocation of Refund (including Savings Bond Purchases), to deposit a refund in up to three accounts. Do not use Form 8888 to designate part of a refund to pay tax preparers.

Taxpayers should deposit refunds into accounts in their own name, their spouse’s name or both. Avoid making a deposit into accounts owned by others. Some banks require both spouses’ names on the account to deposit a tax refund from a joint return. Taxpayers should check with their bank for direct deposit rules.

There is a limit of three electronic direct deposit refunds made into a single financial account or pre-paid debit card. The IRS will send a notice and a refund check in the mail to taxpayers who exceed the limit. Find tips about direct deposit and the split refund option in Publication 17, Your Federal Income Tax. View, download and print tax products anytime at IRS.gov/forms.

All taxpayers should keep a copy of their tax return. Beginning in 2017, taxpayers using a software product for the first time may need their Adjusted Gross Income (AGI) amount from their prior-year tax return to verify their identity. Taxpayers can learn more about how to verify their identity and electronically sign tax returns at Validating Your Electronically Filed Tax Return.

Additional IRS Resources:

IRS YouTube Videos:

  • Direct Deposit for Your Tax RefundSpanish | ASL

How the IRS Taxpayer Bill of Rights Works

Taxpayers have fundamental rights under the law. The “Taxpayer Bill of Rights” presents these rights in 10 categories. This helps taxpayers when they interact with the IRS.

Publication 1, Your Rights as a Taxpayer, highlights a list of taxpayer rights and the agency’s obligations to protect them. Here is a wrap-up of the Taxpayer Bill of Rights:

1. The Right to Be Informed.

Taxpayers have the right to know what is required to comply with the tax laws. They are entitled to clear explanations of the laws and IRS procedures in all tax forms, instructions, publications, notices and correspondence. They have the right to know about IRS decisions affecting their accounts and clear explanations of the outcomes.

2. The Right to Quality Service.

Taxpayers have the right to receive prompt, courteous and professional assistance in their dealings with the IRS and the freedom to speak to a supervisor about inadequate service. Communications from the IRS should be clear and easy to understand.

3. The Right to Pay No More than the Correct Amount of Tax.

Taxpayers have the right to pay only the amount of tax legally due, including interest and penalties. They should also expect the IRS to apply all tax payments properly.

4. The Right to Challenge the IRS’s Position and Be Heard.

Taxpayers have the right to object to formal IRS actions or proposed actions and provide justification with additional documentation. They should expect that the IRS will consider their timely objections and documentation promptly and fairly. If the IRS does not agree with their position, they should expect a response.

5. The Right to Appeal an IRS Decision in an Independent Forum.

Taxpayers are entitled to a fair and impartial administrative appeal of most IRS decisions, including certain penalties. Taxpayers have the right to receive a written response regarding a decision from the Office of Appeals. Taxpayers generally have the right to take their cases to court.

6. The Right to Finality.

Taxpayers have the right to know the maximum amount of time they have to challenge an IRS position and the maximum amount of time the IRS has to audit a particular tax year or collect a tax debt. Taxpayers have the right to know when the IRS concludes an audit.

7. The Right to Privacy.

Taxpayers have the right to expect that any IRS inquiry, examination or enforcement action will comply with the law and be no more intrusive than necessary. They should expect such proceedings to respect all due process rights, including search and seizure protections. The IRS will provide, where applicable, a collection due process hearing.

8. The Right to Confidentiality.

Taxpayers have the right to expect that their tax information will remain confidential. The IRS will not disclose information unless authorized by the taxpayer or by law. Taxpayers should expect the IRS to take appropriate action against employees, return preparers and others who wrongfully use or disclose their return information.

9. The Right to Retain Representation.

Taxpayers have the right to retain an authorized representative of their choice to represent them in their dealings with the IRS. Taxpayers have the right to seek assistance from a Low Income Taxpayer Clinic if they cannot afford representation.

10. The Right to a Fair and Just Tax System.

Taxpayers have the right to expect fairness from the tax system. This includes considering all facts and circumstances that might affect their underlying liabilities, ability to pay or ability to provide information timely. Taxpayers have the right to receive assistance from the Taxpayer Advocate Service if they are experiencing financial difficulty or if the IRS has not resolved their tax issues properly and timely through its normal channels.

The IRS will include Publication 1 when sending a notice to taxpayers on a range of issues, such as an audit or collection matter. IRS offices display the rights for taxpayers and employees to see.

Publication 1 is available in  English, Chinese, Korean, Russian, Spanish and Vietnamese.

All taxpayers should keep a copy of their tax return. Beginning in 2017, taxpayers using a software product for the first time may need their Adjusted Gross Income (AGI) amount from their prior-year tax return to verify their identity. Taxpayers can learn more about how to verify their identity and electronically sign tax returns at Validating Your Electronically Filed Tax Return.

Additional IRS Resources:

IRS YouTube Videos:

IRS Podcasts:

2017 Tax Filing Season Opens Today

IRS YouTube Videos

  • When Will I Get My Refund: English | Spanish
  • Claiming EITC or ACTC? Your refund may be delayed: English
  • Welcome to Free File: English
  • Security Summit Identity Theft Tips Overview:English

WASHINGTON — The Internal Revenue Service said today that it successfully started accepting and processing 2016 federal individual income tax returns on schedule. More than 153 million returns are expected to be filed this year.

People have until Tuesday, April 18, 2017 to file their 2016 returns and pay any taxes due. The deadline is later this year due to several factors. The usual April 15 deadline falls on Saturday this year, which would normally give taxpayers until at least the following Monday. However, Emancipation Day, a D.C. holiday, is observed on Monday, April 17, giving taxpayers nationwide an additional day to file. By law, D.C. holidays impact tax deadlines for everyone in the same way federal holidays do. Taxpayers requesting an extension will have until Monday, Oct. 16, 2017 to file.

“Following months of hard work, we successfully opened our processing systems today to start this year’s tax season,” said IRS Commissioner John Koskinen. “Getting to this point is a year-round effort for the IRS and the nation’s tax community. The dedicated employees of the IRS look forward to serving taxpayers this filing season, and I want to thank all of the tax and payroll community for their hard work that makes tax time smoother for the nation.”

The IRS expects more than 70 percent of taxpayers to get tax refunds this year. Last year, 111 million refunds were issued, with an average refund of $2,860.

Refund Delays

A law change now requires the IRS to hold refunds on tax returns claiming the Earned Income Tax Credit (EITC) or Additional Child Tax Credit (ACTC) until Feb. 15. Under this change required by the Protecting Americans from Tax Hikes (PATH) Act, the IRS must hold the entire refund — even the portion not associated with the EITC and ACTC. Even though the IRS will begin releasing EITC and ACTC refunds on Feb. 15, many early filers will still not have actual access to their refunds until the week of Feb. 27. The additional delay is due to several factors, including weekends, the Presidents Day holiday and the time banks often need to process direct deposits.

This law change gives the IRS more time to detect and prevent fraud. Beyond the EITC and ACTC refunds and the additional security safeguards, the IRS anticipates issuing more than nine out of 10 refunds in less than 21 days. However, it’s possible a particular return may require additional review and take longer. Taxpayers are reminded that state tax agencies have their own refund processing timeframes that vary, and some states may make additional reviews to ensure their refunds are being issued properly. Even so, taxpayers should file as usual, and tax return preparers should submit returns as they normally do.

Use e-File and Free File

The IRS expects more than 80 percent of returns to be filed electronically. Choosing e-file and direct deposit remains the fastest and safest way to file an accurate income tax return and receive a refund.

The IRS Free File program, available at IRS.gov, gives eligible taxpayers a dozen options for brand-name products. Free File is a partnership with commercial partners offering free brand-name software to about 100 million individuals and families with incomes of $64,000 or less. Seventy percent of the nation’s taxpayers are eligible for IRS Free File. People who earned more than $64,000 may use Free File Fillable Forms, the electronic version of IRS paper forms.

Protecting Taxpayers from Identity Theft-Related Refund Fraud

The IRS continues to work with state tax authorities and the tax industry to address tax-related identity theft and refund fraud. As part of the Security Summit effort, stronger protections for taxpayers and the nation’s tax system are in effect for the 2017 tax filing season.

The new measures attack tax-related identity theft from multiple sides. Many changes will be invisible to taxpayers but will help the IRS, states and the tax industry provide new protections. New security requirements will better protect tax software accounts and personal information.

Renew ITIN to Avoid Refund Delays

Many Individual Taxpayer Identification Numbers (ITINs) expired on Jan. 1, 2017. This includes any ITIN not used on a tax return at least once in the past three years. Also now expired is any ITIN with middle digits of either 78 or 79 (Example: 9NN-78-NNNN or 9NN-79-NNNN). Affected taxpayers should act soon to avoid refund delays and possible loss of eligibility for some key tax benefits until the ITIN is renewed. An ITIN is used by anyone who has tax-filing or payment obligations under U.S. tax law but is not eligible for a Social Security number.

It can take up to 11 weeks to process a complete and accurate ITIN renewal application. For that reason, the IRS urges anyone with an expired ITIN needing to file a return this tax season to submit their ITIN renewal application soon.

New AGI requirement for e-file

All taxpayers should keep a copy of their tax return. Beginning in 2017, taxpayers using a tax filing software product for the first time may need their Adjusted Gross Income (AGI) amount from their prior-year tax return to verify their identity. Taxpayers can learn more about how to verify their identity and electronically sign tax returns at Validating Your Electronically Filed Tax Return.

Free Tax Help

Low- and moderate-income taxpayers can get help filing their tax return for free. More than 90,000 volunteers around the country can help people correctly complete their return.

To get this filing help, taxpayers can visit one of the more than 12,000 community-based tax help sites that participate in the Volunteer Income Tax Assistance and Tax Counseling for the Elderly programs. To find the nearest site, use the VITA/TCE Site Locator on IRS.gov or the IRS2Go mobile app.

Filing Assistance

The IRS reminds taxpayers that a trusted tax professional can provide helpful information about the tax laws. A number of tips about selecting a preparer and information about national tax professional groups are available on IRS.gov.

The IRS urges all taxpayers to make sure they have all their year-end statements in hand before filing. This includes Forms W-2 from employers and Forms 1099 from banks and other payers. Doing so will help avoid refund delays and the need to file an amended return.

Online tools

Many tax issues can now be resolved online or by phone from the convenience of a home or office. The IRS urges taxpayers to take advantage of the many tools and other resources available on IRS.gov. IRS phone lines will be busy again this year, so in order to save time, people should first visit the IRS website for tax assistance.

2017 Tax Filing Season Begins Jan. 23 for Nation’s Taxpayers, Tax Returns due April 18

IRS YouTube Video April 18 is When Your Taxes are Due in 2017                                                             

WASHINGTON ― The Internal Revenue Service announced today that the nation’s tax season will begin Monday, Jan. 23, 2017 and reminded taxpayers claiming certain tax credits to expect a longer wait for refunds.

 The IRS will begin accepting electronic tax returns that day, with more than 153 million individual tax returns expected to be filed in 2017. The IRS again expects more than four out of five tax returns will be prepared electronically using tax return preparation software.

 Many software companies and tax professionals will be accepting tax returns before Jan. 23 and then will submit the returns when IRS systems open. The IRS will begin processing paper tax returns at the same time. There is no advantage to filing tax returns on paper in early January instead of waiting for the IRS to begin accepting e-filed returns.

 The IRS reminds taxpayers that a new law requires the IRS to hold refunds claiming the Earned Income Tax Credit (EITC) and the Additional Child Tax Credit (ACTC) until Feb. 15. In addition, the IRS wants taxpayers to be aware it will take several days for these refunds to be released and processed through financial institutions. Factoring in weekends and the President’s Day holiday, the IRS cautions that many affected taxpayers may not have actual access to their refunds until the week of Feb. 27.

 “For this tax season, it’s more important than ever for taxpayers to plan ahead,” IRS Commissioner John Koskinen said. “People should make sure they have their year-end tax statements in hand, and we encourage people to file as they normally would, including those claiming the credits affected by the refund delay. Even with these significant changes, IRS employees and the entire tax community will be working hard to make this a smooth filing season for taxpayers.”

The IRS also reminds taxpayers that they should keep copies of their prior-year tax returns for at least three years. Taxpayers who are changing tax software products this filing season will need their adjusted gross income from their 2015 tax return in order to file electronically. The Electronic Filing Pin is no longer an option. Taxpayers can visit IRS.Gov/GetReady for more tips on preparing to file their 2016 tax return.

 April 18 Filing Deadline

The filing deadline to submit 2016 tax returns is Tuesday, April 18, 2017, rather than the traditional April 15 date. In 2017, April 15 falls on a Saturday, and this would usually move the filing deadline to the following Monday – April 17. However, Emancipation Day – a legal holiday in the District of Columbia – will be observed on that Monday, which pushes the nation’s filing deadline to Tuesday, April 18, 2017. Under the tax law, legal holidays in the District of Columbia affect the filing deadline across the nation.

 “The opening of filing season reflects months and months of work by IRS employees,” Koskinen said. “This year, we had a number of important legislative changes to program into our systems, including the EITC refund date, as well as dealing with resource limitations. Our systems require extensive programming and testing beforehand to ensure we’re ready to accept and process more than 150 million returns.”

 The IRS also has been working with the tax industry and state revenue departments as part of the Security Summit initiative to continue strengthening processing systems to protect taxpayers from identity theft and refund fraud. A number of new provisions are being added in 2017 to expand progress made during the past year.

 Refunds in 2017
Choosing e-file and direct deposit for refunds remains the fastest and safest way to file an accurate income tax return and receive a refund.

 The IRS still anticipates issuing more than nine out of 10 refunds in less than 21 days, but there are some important factors to keep in mind for taxpayers.

Beginning in 2017, a new law requires the IRS to hold refunds on tax returns claiming the Earned Income Tax Credit or the Additional Child Tax Credit until mid-February. Under the change required by Congress in the Protecting Americans from Tax Hikes (PATH) Act, the IRS must hold the entire refund — even the portion not associated with the EITC and ACTC — until at least Feb. 15. This change helps ensure that taxpayers get the refund they are owed by giving the IRS more time to help detect and prevent fraud.

As in past years, the IRS will begin accepting and processing tax returns once the filing season begins. All taxpayers should file as usual, and tax return preparers should also submit returns as they normally do – including returns claiming EITC and ACTC.

 The IRS will begin releasing EITC and ACTC refunds startingFeb. 15. However, the IRS cautions taxpayers that these refunds likely won’t arrive in bank accounts or on debit cards until the week of Feb. 27 (assuming there are no processing issues with the tax return and the taxpayer chose direct deposit). This additional period is due to several factors, including banking and financial systems needing time to process deposits.

After refunds leave the IRS, it takes additional time for them to be processed and for financial institutions to accept and deposit the refunds to bank accounts and products. The IRS reminds taxpayers many financial institutions do not process payments on weekends or holidays, which can affect when refunds reach taxpayers. For EITC and ACTC filers, the three-day holiday weekend involving President’s Day may affect their refund timing.

 Where’s My Refund? ‎on IRS.gov and the IRS2Go phone app will be updated with projected deposit dates for early EITC and ACTC refund filers a few days after Feb. 15. Taxpayers will not see a refund date on Where’s My Refund? ‎or through their software packages until then. The IRS, tax preparers and tax software will not have additional information on refund dates, so Where’s My Refund? remains the best way to check the status of a refund.

 Help for Taxpayers

 The IRS reminds taxpayers they have a variety of options to get help filing and preparing their tax return on IRS.gov. Taxpayers can also, if eligible, locate help from a community volunteer. Go to IRS.gov and click on the Filing tab for more information.

 Seventy percent of the nation’s taxpayers are eligible for IRS Free File. Commercial partners of the IRS offer free brand-name software to about 100 million individuals and families with incomes of $64,000 or less.

 Online fillable forms provides electronic versions of IRS paper forms to all taxpayers regardless of income that can be prepared and filed by people comfortable with completing their own returns.

 Volunteer Income Tax Assistance (VITA) and Tax Counseling for the Elderly (TCE) offer free tax help to people who qualify. Go toirs.gov and enter “free tax prep” in the search box to learn more and find a nearby VITA or TCE site, or download the IRS2Go smartphone app to find a free tax prep provider.

 The IRS also reminds taxpayers that a trusted tax professional can provide helpful information and advice about the ever-changing tax code. Tips for choosing a return preparer and details about national tax professional groups are available on IRS.gov.

 Renewal Reminder for Individual Taxpayer Identification Numbers (ITINS) ITINs are used by people who have tax-filing or payment obligations under U.S. law but are not eligible for a Social Security number. Under a recent change in law, any ITIN not used on a tax return at least once in the past three years will expire on Jan. 1, 2017. In addition, any ITIN with middle digits of either 78 or 79 (9NN-78-NNNN or 9NN-79-NNNN) will also expire on that date.

 This means that anyone with an expiring ITIN and a need to file a tax return in the upcoming filing season should file a renewal application in the next few weeks to avoid lengthy refund and processing delays. Failure to renew early could result in refund delays and denial of some tax benefits until the ITIN is renewed.

 An ITIN renewal application filed now will be processed before one submitted at the height of tax season from mid-January to February. Currently, a complete and accurate renewal application can be processed in as little as seven weeks. But this timeframe is expected to expand to as much as 11 weeks during tax season, which runs from mid-January through April.

 Several common errors are currently slowing down or holding up ITIN renewal applications. The mistakes generally center on missing information, and/or insufficient supporting documentation. ITIN renewal applicants should be sure to use the latest version of Form W-7, revised September 2016. The most current version of the form, along with its instructions, are posted on IRS.gov.

 

Top Patent Stories

By Debby Winters

Every year Donald Zuhn recalls the top 20 patent stories for the past year.  You can find his selections for 2016 at these links: Stories 16 to 20, 11 to 15, 6- 10, and the top 5 stories.

Of note are the following:

#18 about the CRISPR patent.  CRISPR is an acronym for Clustered Regularly lnterspaced Short Palindromic Repeats.  There are many aspects about this, or should I say “these,” patents as more than one has been filed, and that’s part of the story itself.  Since these patents were filed in the days of first-to-invent, rather than first-to-file, therein lies an additional wrinkle to this story.  I will be blogging about CRISPR in the days to come, so won’t go into detail now, but it will be an interesting patent story in 2017 as well.

#16 about the new Trade Secret law, the Defend Trade Secrets Act of 2016 (“DTSA”) signed in law in 2016 by President Obama. Let’s keep our eyes on how this will morph in years to come, especially in light of a new Presidential Administration.

#4  is one of the important stories for both patent attorneys and inventors. In May of 2016, the U.S. Patent and Trademark Office issued the Subject Matter Eligibility Update, which provides further guidance for determining subject matter eligibility under 35 U.S.C. § 101.  We will see more to come on this topic to help clarify what is eligible subject matter for a patent and what is not.  This is also the topic of #2 in continuing fallout of the Supreme Court’s 2014 Alice Corp. v. CLS Bank.

#1- The top patent story, according to Dr. Zuhn was the Supreme Courts refusal to hear a case referred to as Sequenom.  Despite Sequenom’s petition for certiorari and a total of twenty-two amicus briefs that were filed encouraging the Court to grant certiorari, in June, the Supreme Court surprised many in the patent community by issuing an order denying certiorari in the case.  This story is from the Federal Circuit’s very controversial decision in Ariosa Diagnostics, Inc. v. Sequenom, Inc., in which the Federal Circuit affirmed the District Court’s grant of summary judgment of invalidity that the claims of U.S. Patent No. 6,258,540 concerning fetal DNA were patent ineligible.

For more details on any of these cases, click on the links above.