Day 10 – No time, let’s sum up
The clock is counting down, the documents are coming in, and people are looking forward to tax refunds showing up in their bank accounts. Now allow me to dazzle you with my superpower – removing the fun and excitement out of everything. My kids dubbed me the “fun sucker” at least 15 years ago.
Ready for my superpower? Here we go!
Preparation is the best defense against delays!
Step 1 – Gather
Documentation is of the utmost importance this year. Not only is the “stimulus” being reconciled on the return, but also the Advanced Child Tax Credit payments received. The IRS has sent out letters confirming both the third “stimulus” payments and Advanced Child Tax Credit payments that were issued. If you cannot locate these documents, please go to irs.gov and view your account and provide a transcript of your 2021 tax return to your tax pro. Trust me when I say this information is necessary.
Step 2 – Check
Look at your tax statements you receive from employers and contractors. Be aware of the amounts reported to the IRS under your name. If the amounts do not match final paycheck stubs or bank records, confirm the information with the issuer prior to taking it to your tax pro. Not only will this help ensure proper income reporting but also give you a clearer picture of your income and withholding. Yep math, I am recommending doing a little math.
Step 3 – Respond
Yes, your tax pro asks the same questions every year. Yes, you are asked to provide the same information year-to-year. Yes, your tax pro needs all the information on the checklist. Yes, all the documentation is required to file your return. Most importantly – provide your tax pro with your current contact information. I know it seems like a ridiculously basic request, but you would be surprised by how many people forget to update their address or telephone numbers. Also, an email address is essential for updates and tax law changes throughout the year.
Step 4 – Hurry up and wait
And the most hated phrase in my entire arsenal – “be patient.” The backlog at the IRS is unprecedented. Identity theft is on the rise. Employer and business reporting has become more complicated. Temporary changes to tax code slow down processing. COVID continues to impact the workforce. All returns with Advanced Child Tax Credits and Earned Income Credits will be delayed at least until the middle of February.
Brace yourself…now it begins.