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Earned Income Tax Credit – Get it Right – English | Spanish | ASL

WASHINGTON − The Internal Revenue Service and its partners nationwide remind taxpayers about the Earned Income Tax Credit on Jan. 31, “EITC Awareness Day.” This is the 14th year of the EITC awareness campaign that alerts millions of workers to this significant tax credit.

"The EITC is a vital tax credit that helps millions of hard-working working families around the nation," said IRS Commissioner Chuck Rettig. "It’s critical that people review the credit to see if they qualify. Increasing awareness about the EITC is important, and the IRS is proud to support the ongoing efforts by partner groups across the country for sharing this critical information with taxpayers.”

There are outreach events and activities scheduled to promote EITC awareness around the country. The EITC is the federal government’s largest refundable federal income tax credit for low- to moderate-income workers. It can give taxpayers a refund even if they owe no tax.

The IRS estimates four of five eligible taxpayers claim and get the EITC. Nationwide in 2019, 25 million taxpayers received over $61 billion in EITC. The average EITC amount received was $2,504. The EITC is as much as $6,557 for a family with children or up to $529 for taxpayers who do not have a qualifying child.

Taxpayers earning $55,952 or less can see if they qualify using the EITC Assistant tool at www.irs.gov/eitc. The EITC Assistant, available in English and Spanish, helps users determine if they are eligible and if they have a qualifying child or children, and it estimates the amount of the EITC they may get. If an individual doesn’t qualify for the EITC, the Assistant explains why.

Workers who can claim the EITC
Workers at risk for overlooking this important credit can include taxpayers:

How to claim the EITC
To get the EITC, workers must file a tax return and claim the credit, even if their earnings were below the filing requirement. Free tax preparation help is available online and through volunteer organizations.

Those eligible for the EITC have these options:

The IRS reminds taxpayers to be sure they have valid Social Security numbers (SSN) for themselves, their spouse, if filing a joint return, and for each qualifying child claimed for the EITC. The SSNs must be issued before the due date of the return, including extensions. There are special rules for those in the military or those out of the country.

Refunds
By law the IRS cannot issue refunds before mid-February for tax returns that claim the EITC or the Additional Child Tax Credit (ACTC). The IRS must hold the entire refund − even the portion not associated with EITC or ACTC. This helps ensure taxpayers receive the refund they deserve and gives the agency more time to detect and prevent errors and fraud. 
 
'Where’s My Refund?' on IRS.gov and the IRS2Go app will be updated with projected deposit dates for most early EITC/ACTC refund filers by Feb. 22. So EITC /ACTC filers will not see an update to their refund status for several days after Feb. 15. The IRS expects most EITC or ACTC related refunds to be available in taxpayer bank accounts or on debit cards by the first week of March, if they choose direct deposit and there are no other issues with their tax return. Check ‘Where’s My Refund?’ for a personalized refund date.

Avoid errors
Taxpayers are responsible for the accuracy of their tax return even if someone else prepares it for them. The EITC rules can be complicated and the IRS urges taxpayers to seek help to make sure they are eligible by visiting a free tax return preparation site, or using Free File software or a paid tax professional. Errors can have lasting impact on future eligibility to claim EITC and leave taxpayers with a penalty.  

Taxpayers should be sure to reply promptly to any letter from the IRS requesting additional information about EITC and call the number on the IRS letter if they need assistance or have questions.

Taxpayers who had an EITC claim reduced or denied for any reason other than a mathematical or clerical error must file Form 8862, Information to Claim Certain Credits after Disallowance, to claim the credit.

Beware of scams
Be sure to choose a tax preparer wisely. 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.

Visit IRS online
IRS.gov is a valuable first stop to help taxpayers get it right this filing season. Information on other tax credits, such as the Child Tax Credit, are also available.

Related items

WASHINGTON — With just a few days remaining until the deadline, the Internal Revenue Service reminds employers and other businesses that Jan. 31 is the filing deadline for submitting wage statements and forms for independent contractors with the government.

Employers must file their copies of Form W-2, Wage and Tax Statement, and Form W-3, Transmittal of Wage and Tax Statements, with the Social Security Administration by Jan. 31. The Jan. 31 deadline also applies to certain Forms 1099-MISC, Miscellaneous Income, filed with the IRS to report non-employee compensation to independent contractors.

This deadline helps the IRS fight tax fraud by making it easier to verify income reported on individual tax returns. The IRS no longer grants an automatic extension of time to file Form W-2. Requests for more time to file must be submitted before the due date. Only certain reasons, such as a death or natural disaster are allowed. Details can be found on the instructions for Form 8809, Application for Extension of Time To File Information Returns.

Failure to file these forms correctly and timely may result in penalties. The IRS recommends employers and other businesses to e-file as the quickest, most accurate and convenient way to file these forms.

Taxpayers: Steps to take if no W-2

Most taxpayers get their Form W-2, Wage and Tax Statement, by the end of January. Taxpayers need their W-2s to file accurate tax returns, as the form shows an employee’s income and taxes withheld for the year.

Taxpayers who haven’t received their W-2 by the end of February should, as a first step, contact their employer. Taxpayers should ask their current or former employer for a copy of their W-2. Be sure the employer has the correct address. Additional information for taxpayers is available at IRS.gov.

WASHINGTON ― The Internal Revenue Service successfully opened the 2020 tax filing season today as the agency begins accepting and processing federal tax returns for tax year 2019.

The deadline to file a 2019 tax return and pay any tax owed is Wednesday, April 15, 2020.  More than 150 million individual tax returns for the 2019 tax year are expected to be filed, with the vast majority of those coming before the April 15 tax deadline. 

"The IRS workforce has worked for nearly a year to prepare for the opening of tax season,” said IRS Commissioner Chuck Rettig. “Our dedicated employees are committed to help taxpayers, process tax returns and serve the nation − not just through the April 15 tax deadline but throughout the year.”

While the IRS’ Free File program as well as many tax software companies and tax professionals began accepting tax returns earlier this month, processing of those tax returns begins as IRS systems open today.

The IRS expects about 90 percent of individuals to file their returns electronically. Filing electronically and choosing direct deposit remains the fastest and safest way to file an accurate income tax return and receive a refund.

“The IRS reminds taxpayers there are many options to get help,” Rettig said. “Our website has around the clock information available and is the fastest way to get assistance. We’ve made improvements to the Free File program and filing electronically with direct deposit remains the best way to speed refunds and minimize errors. As always, experts in the nation’s tax professional community stand ready to help people navigate their tax issues. And we also remind people our IRS-trained community volunteers are ready to help file tax returns in locations across the country.”

Revised 2019 Form 1040 includes virtual currency questions

Using feedback from taxpayers and the tax professional community, IRS revised the Form 1040, U.S. Individual Income Tax Return, for tax year 2019. Taxpayers will use fewer schedules to supplement the base Form 1040 as six schedules were consolidated into three numbered schedules.

In 2019, taxpayers who engaged in a transaction involving virtual currency will need to file Schedule 1, Additional Income and Adjustments To Income. The Internal Revenue Code and regulations require taxpayers to maintain records that support the information provided on tax returns. Taxpayers should maintain, for example, records documenting receipts, sales, exchanges or other dispositions of virtual currency and the fair market value of the virtual currency.

“Virtual currency is an important addition to the 1040 this year,” Rettig said. “This emerging area is a priority for the IRS, and we want to help taxpayers understand their obligations involving virtual currency. We will also take steps to ensure fair enforcement of the tax laws for those who don’t follow the rules involving virtual currency.”

New Form 1040-SR alternative for seniors available

While all taxpayers file Form 1040, taxpayers born before Jan. 2, 1955, have an additional option to use new Form 1040-SR, U.S. Tax Return for Seniors. Taxpayers age 65 or older will have the option to use this new form – either filing electronically or mailing a paper return − when they file their 2019 federal income tax return in 2020. Form 1040-SR generally mirrors Form 1040.

Form 1040-SR allows income reporting from certain other sources such as investment income, Social Security, and distributions from qualified retirement plans, annuities or similar deferred-payment arrangements to eligible taxpayers over age 65. Taxpayers 65 and older have the option to file Form 1040-SR whether they are working, not working or retired.

The Form 1040-SR includes a standard deduction chart listing the standard deduction amounts, including the extra standard deduction amount that taxpayers 65 and older qualify for. Eligible taxpayers 65 and older who plan to itemize deductions − instead of taking the standard deduction − will be able to file Form 1040-SR along with Schedule A, Itemized Deductions, when they file their 2019 tax return.

The Form 1040 Instructions cover both Form 1040 and Form 1040-SR. Both forms use the same “building block” approach introduced last year that can be supplemented with additional schedules as needed. Taxpayers with straightforward tax situations will only need to file the Form 1040 or Form 1040-SR with no additional schedules.

Since nearly 90% of taxpayers now use tax software, the IRS expects the change to Form 1040 and the introduction of the Form 1040-SR and its schedules to be seamless for those who file electronically including those who are eligible to use IRS Free File,  the Volunteer Income Tax Assistance (VITA) program or the Tax Counseling for the Elderly (TCE) program.

Free help preparing and filing taxes electronically

The IRS strongly encourages people to file their tax returns electronically and choose direct deposit for faster refunds. Filing electronically reduces tax return errors as the tax software does the calculations, flags common errors and prompts taxpayers for missing information.

The IRS supports free online and in-person tax preparation options for qualifying taxpayers through IRS Free File online or free tax help from trained volunteers at community sites around the country.

Taxpayers with incomes that were $69,000 or less last year – and that’s most taxpayers – can use IRS  Free File  now through Oct. 15. Free File is a public-private partnership between the Internal Revenue Service and Free File Inc. (FFI), a consortium of tax software providers who make their Free File products available at IRS.gov/FreeFile.

Taxpayers can use a “look up” tool to choose from one of 10 featured online products. Each of the 10 providers sets its own eligibility standards, generally based on income, age and state residency giving taxpayers who earned $69,000 or less at least one product to use for free. There are also products in Spanish. For taxpayers who earned more, there is Free File Fillable Forms, the electronic version of IRS paper forms. 

Free File is just one way the IRS provides free tax preparation options to taxpayers through a partnership model. Taxpayers wanting more personal help can visit one of thousands of community volunteer sites through the Volunteer Income Tax Assistance program or Tax Counseling for the Elderly offered by AARP. The IRS partners with community organizations and AARP to train volunteers to prepare free returns for taxpayers.

The Volunteer Income Tax Assistance (VITA) program offers free tax help to people who generally make $56,000 or less, persons with disabilities and limited English-speaking taxpayers who need help preparing their own tax returns. IRS-certified volunteers provide free basic income tax return preparation with electronic filing to qualified individuals.

In addition to VITA, the Tax Counseling for the Elderly (TCE) program offers free tax help for all taxpayers, particularly those who are 60 and older, specializing in questions about pensions and retirement-related issues unique to seniors. The IRS-certified volunteers who provide tax counseling are often retired individuals associated with non-profit organizations that receive grants from the IRS.

Taxpayers: Rely on a reputable tax professional; IRS.gov can help

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

No matter who prepares a federal tax return, by signing the return, the taxpayer becomes legally responsible for the accuracy of all information included.

Gather documents and organize tax records

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. Taxpayers should confirm that each employer, bank or other payer has a current mailing address or email address. Typically, year-end forms start arriving by mail – or are available online – in January. Review them carefully and, if any of the information shown is inaccurate, contact the payer right away for a correction.

In 2019, taxpayers who engaged in a transaction involving virtual currency will need to file Schedule 1, Additional Income and Adjustments To Income. The Internal Revenue Code and regulations require taxpayers to maintain records that support the information provided on tax returns.  Taxpayers should maintain, for example, records documenting receipts, sales, exchanges, or other dispositions of virtual currency and the fair market value of the virtual currency.

To avoid refund delays, be sure to gather all year-end income documents before filing a 2019 tax return. Doing so will help avoid refund delays and the need to file an amended return. Filing too early, before receiving a key document, often means a taxpayer must file an amended return to report additional income or claim a refund. It can take up to 16 weeks to process an amended return and issue any related refund.

Most refunds sent in less than 21 days; however, some require further review and take longer

Just as each tax return is unique and individual, so is each taxpayer's refund. There are a few things taxpayers should keep in mind if they are waiting on their refund but hear or see on social media that other taxpayers have already received theirs.

Different factors can affect the timing of a taxpayer’s refund after the IRS receives the return. Also, remember to take into consideration the time it takes for the financial institution to post the refund to the taxpayer’s account or to receive a check in the mail.

Even though the IRS issues most refunds in less than 21 days, some tax returns require additional review and take longer to process than others. This may be necessary when a return has errors, is incomplete or is affected by identity theft or fraud. The IRS will contact taxpayers by mail when more information is needed to process a return.

Choosing electronic filing and direct deposit for refunds remains the fastest and safest way to file an accurate income tax return and receive a refund. The IRS expects about 90 percent of individual tax returns will be prepared electronically using tax software.

The IRS reminds taxpayers that, by law, the IRS cannot issue refunds claiming the Earned Income Tax Credit (EITC) or the Additional Child Tax Credit (ACTC) before mid-February. This applies to the entire refund − even the portion not associated with the EITC or ACTC. The IRS expects most EITC/ACTC related refunds to be available in taxpayer bank accounts or on debit cards by the first week of March, if the taxpayer chose direct deposit and there are no other issues with the tax return.

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.

Refund information will generally be available within 24 hours after the IRS acknowledges receipt of an electronically filed return on the Where's My Refund? ‎tool on IRS.gov and the IRS2Go phone app. These tools will be updated with projected deposit dates for most early EITC and ACTC refund filers by Feb. 22, so those filers will not see an update to their refund status 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. Where’s My Refund? is the best way to check the status of a refund.

Reconcile advance payments of Marketplace premium tax credits; health care reporting changes

The premium tax credit helps pay premiums for health insurance purchased from the Health Insurance Marketplace. Taxpayers who receive advance credit payments must compare and reconcile their advance credit payments to the actual premium tax credit they are allowed for the year. They do this reconciliation when they file their tax return on Form 8962, Premium Tax Credit. Failing to file Form 8962 and reconcile 2019 advance credit payments may affect return processing, generate an IRS letter and delay the taxpayer’s refund. It may also affect a taxpayer’s eligibility for advance payments of the premium tax credit or cost-sharing reductions to help pay Marketplace health insurance coverage in the future.

On a separate note, the IRS removed the “full-year health care coverage or exempt” box on Form 1040 to report health care coverage. Taxpayers will not make a shared responsibility payment or file Form 8965, Health Coverage Exemptions, to claim a coverage exemption for tax year 2019.

Renew expired ITINs to avoid refund delays

Many Individual Taxpayer Identification Numbers (ITINs) expired on Dec. 31, 2019. This includes any ITIN not used on a tax return at least once in the past three years. Any ITIN with middle digits 83, 84, 85, 86 or 87 expired Dec. 31, 2019. ITINs with middle digits 70 through 82 that expired in 2016, 2017 or 2018 can also be renewed. 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 tax return this tax season to submit their ITIN renewal application soon.

Sign and validate electronically filed tax returns

The IRS also reminds taxpayers that they should keep copies of their prior-year tax returns for at least three years. Taxpayers who are using the same tax software they used last year will not need to enter prior-year information to electronically sign their 2019 tax return.

Taxpayers who are using a tax software product for the first time will need their adjusted gross income from their 2018 tax return to file electronically. Review these steps to validate and sign an electronically filed return.

Identity Theft Central; IP PIN expansion

The Internal Revenue Service launched Identity Theft Central to improve online access to information on identity theft or data security protection for taxpayers, tax professionals and businesses.

Improving awareness and outreach have been hallmarks of the initiatives to combat identity theft coordinated by the IRS, state tax agencies and the nation’s tax industry who work in partnership under the Security Summit banner. Tax-related identity theft happens when someone steals personal information to commit tax fraud.

More taxpayers in selected locations will be eligible for a new online-only Identity Protection PIN Opt-In Program. The IP PIN is a six-digit number that adds a layer of protection for taxpayers’ Social Security numbers and helps protect against tax-related identity theft.

Taxpayers will be eligible for this voluntary program if they filed a federal tax return last year as a resident from Arizona, California, Colorado, Connecticut, Delaware, District of Columbia, Florida, Georgia, Illinois, Maryland, Michigan, Nevada, New Jersey, New Mexico, New York, North Carolina, Pennsylvania, Rhode Island, Texas or Washington.

The IRS has created a new publication – Publication 5367, Identity Protection PIN Opt-In Program for Taxpayers – to help taxpayers understand the required steps. Or, taxpayers can read more at the Get an IP PIN page. Taxpayers opting into this program must use the Get an IP PIN tool; an IP PIN cannot be issued via a phone call to the IRS.

IRS offers help and online tools for taxpayers

The IRS reminds taxpayers they have a variety of options to get help filing and preparing their tax return on IRS.gov, the official IRS website. Taxpayers can find answers to their tax questions and resolve tax issues online. The Let Us Help You page helps answer most tax questions, and the IRS Services Guide links to these and other IRS services.

Use the Interactive Tax Assistant to find answers to tax questions. This tool provides answers to tax law questions and reflects 2019 tax changes. The ITA is a tax law resource that takes the taxpayer through a series of questions and provides an answer based on their input. It can determine if a type of income is taxable, if the taxpayer is eligible to claim certain credits or deduct certain expenses on their tax return. It also provides answers for general questions, such as determining filing status or if they are required to file a tax return.

Refund information will generally be available within 24 hours after the IRS acknowledges receipt of an electronically filed return on the Where's My Refund? ‎tool on IRS.gov and the IRS2Go phone app.

Taxpayers can go to View Your Account Information to securely access information about their federal tax account. They can view the amount they owe, pay online or set up an online payment agreement; access their tax records online; review the past 24 months of payment history; and view key tax return information for the current year as filed. Visit IRS.gov/secureaccess to review the required identity authentication process.

WASHINGTON – The Internal Revenue Service has provided relief to financial institutions that were expected to provide required minimum distribution (RMD) statements to IRA owners by Jan 31, 2020. 

Notice 2020-6 clarifies that if an RMD statement is provided for 2020 to an IRA owner who will turn age 70½ in 2020, the IRS will not consider the statement to be incorrect, but only if the financial institution notifies the IRA owner no later than April 15, 2020, that no RMD is due for 2020.

The Setting Every Community Up for Retirement Enhancement Act of 2019 (SECURE Act) changed the age for which an RMD is first required from age 70½ to 72. Under prior law, financial institutions would have needed to notify IRA owners who attained age 70½ in 2020 about their 2020 RMDs by Jan. 31, 2020.

The IRS encourages all financial institutions, in communicating these RMD changes, to remind IRA owners who reached age 70½ in 2019, and have not yet taken their 2019 RMDs, that they are still required to take those distributions by April 1, 2020. 

Under pre-amended law, by January 31st, the financial institutions would have had to notify IRA owners who turned 70½ in 2020 about the required minimum distribution (RMD) which would have needed to be made for 2020.  The SECURE Act changed the age triggering the RMD requirement from 70 and ½ to 72, so these notices are no longer due under the amended law.   Notice 2020-06 proves that if a RMD statement is provided for 2020 to an IRA owner who will attain age 70½ in 2020, the IRS will not consider such statement to be incorrect, provided that the financial institution notifies the IRA owner no later than April 15, 2020, that no RMD is due for 2020.

Notice 2020-06 will be in IRB: 2020-7, dated February 10, 2020.

WASHINGTON – A globally coordinated day of action to put a stop to the suspected facilitation of offshore tax evasion has been undertaken this week across the United Kingdom (UK), United States (US), Canada, Australia and the Netherlands.

The action occurred as part of a series of investigations in multiple countries into an international financial institution located in Central America, whose products and services are believed to be facilitating money laundering and tax evasion for customers across the globe.

It is believed that through this institution a number of clients may be using a sophisticated system to conceal and transfer wealth anonymously to evade their tax obligations and launder the proceeds of crime.

The coordinated day of action involved evidence, intelligence and information collection activities such as search warrants, interviews and subpoenas. Significant information was obtained as a result and investigations are ongoing. It is expected that further criminal, civil and regulatory action will arise from these actions in each country.

This is the first major operational activity for the Joint Chiefs of Global Tax Enforcement, known as the J5, formed in mid-2018 to lead the fight against international tax crime and money laundering. This group brings together leaders of tax enforcement authorities from Australia, Canada, the UK, US and the Netherlands.

“This is the first coordinated set of enforcement actions undertaken on a global scale by the J5 – the first of many,” said Don Fort, US Chief, Internal Revenue Service Criminal Investigation.

“Working with the J5 countries who all have the same goal, we are able to broaden our reach, speed up our investigations and have an exponentially larger impact on global tax administration. Tax cheats in the US and abroad should be on notice that their days of non-compliance are over,” Fort said.

Australian Tax Office (ATO) Deputy Commissioner and Australia’s J5 Chief, Will Day, said that this operation shows that the collaboration between the J5 countries is working. “Today’s action shows the power of our combined efforts in tackling global tax crime, fraud and evasion.”

“This multi-agency, multi-country activity should degrade the confidence of anyone who was considering an offshore location as a way to evade tax or launder the proceeds of crime.”

The ATO has commenced investigations into Australian based clients of this institution who are suspected to have undeclared income. The Australian Criminal Intelligence Commission (ACIC) is playing a supportive intelligence role, and investigations into more clients may follow.

“Never before have criminals been at such risk of being detected as they are now. Our increased collaboration, data analytics and intelligence sharing mean there is no place worldwide you can hide your money to avoid contributing your obligations,” Day said.

Hans van der Vlist, Chief and General Director Fiscal Information and Investigation Service (FIOD), the Netherlands, said, “This is the first outcome of an operational collaboration between five countries on tackling professional enablers that facilitate offshore tax crime.

The international investigation started on information obtained by the Netherlands. By sharing this information and working together an international impact is created. Together as the J5 we will try to close the net on tax criminals.”

Canada Revenue Agency (CRA) Chief Eric Ferron said, “I am very pleased with the role the CRA is playing in what will be the first of many major operational activities for the J5. This coordinated operation shows that the collaboration between J5 countries is working. Tax evaders beware; today’s action shows that through our combined efforts we are making it increasingly difficult for taxpayers to hide their money and avoid paying their fair share.”

Simon York, Chief and Director of Her Majesty’s Revenue and Customs (HMRC)’s Fraud Investigation Service said, “Tax evasion is a global problem that needs a global response and that is what the J5 provides. This kind of international action shows that we can, and we will take on the most collaboration underlines our commitment to tackling these harmful, sophisticated and complex crimes and that we are committed to levelling the playing field for honest businesses and taxpayers.

“International tax evasion robs our public services of vital funds, undermines economies and, left unchecked, can enrich the dishonest at the expense of the honest majority.

Working together, HMRC and our J5 partners are closing the net on tax criminals, wherever they are, to ensure nobody is beyond our reach. The message to them is clear – the J5 are closing in.”

For more information about J5, please visit www.irs.gov/J5.

WASHINGTON – With the start of the 2020 tax filing season near, the Internal Revenue Service is reminding taxpayers to avoid unethical “ghost” tax return preparers.

According to the IRS, a ghost preparer does not sign a tax return they prepare. Unscrupulous ghost preparers will print the return and tell the taxpayer to sign and mail it to the IRS. For e-filed returns, the ghost will prepare but refuse to digitally sign as the paid preparer.

By law, anyone who is paid to prepare or assists in preparing federal tax returns must have a valid Preparer Tax Identification Number, or PTIN. Paid preparers must sign and include their PTIN on the return. Not signing a return is a red flag that the paid preparer may be looking to make a fast buck by promising a big refund or charging fees based on the size of the refund.

Ghost tax return preparers may also:

• Require payment in cash only and not provide a receipt.
• Invent income to qualify their clients for tax credits.
• Claim fake deductions to boost the size of the refund.
• Direct refunds into their bank account, not the taxpayer’s account.

The IRS urges taxpayers to choose a tax return preparer wisely. The Choosing a Tax Professional page on IRS.gov has information about tax preparer credentials and qualifications. The IRS Directory of Federal Tax Return Preparers with Credentials and Select Qualifications can help identify many preparers by type of credential or qualification.

Free basic income tax return preparation with e-file is available to qualified individuals from IRS-certified volunteers at Volunteer Income Tax Assistance (VITA) and Tax Counseling for the Elderly (TCE) sites across the country. For more information and to find the closest visit Free Tax Return Preparation for Qualifying Taxpayers on IRS.gov

No matter who prepares the return, the IRS urges taxpayers to review it carefully and ask questions about anything not clear before signing. Taxpayers should verify both their routing and bank account number on the completed tax return for any direct deposit refund. And taxpayers should watch out for ghost preparers inserting their bank account information onto the returns.

Taxpayers can report preparer misconduct to the IRS using IRS Form 14157, Complaint: Tax Return Preparer. If a taxpayer suspects a tax preparer filed or changed their tax return without their consent, they should file Form 14157-A, Tax Return Preparer Fraud or Misconduct Affidavit.

Notice 2020-07 provides guidance on the corporate bond monthly yield curve, the corresponding spot segment rates used under § 417(e)(3), and the 24-month average segment rates under § 430(h)(2) of the Internal Revenue Code.  In addition, this notice provides guidance as to the interest rate on 30-year Treasury securities under § 417(e)(3)(A)(ii)(II) as in effect for plan years beginning before 2008 and the 30-year Treasury weighted average rate under § 431(c)(6)(E)(ii)(I), as reflected by the application of § 430(h)(2)(C)(iv). 

WASHINGTON — The IRS announced today that the agency has become aware of limited circumstances in which it may be appropriate to provide relief from double taxation resulting from application of the repatriation tax under section 965, as amended by the Tax Cuts and Jobs Act (TCJA). 

The IRS has determined that in unique circumstances, such as where a corporation paid an unusual dividend for business reasons, not because of the enactment of TCJA, it may be appropriate to provide relief from double taxation. When the same earnings and profits of foreign corporations are taxed both as dividends and under section 965, double taxation could result.

The IRS is open to considering relief from such double taxation where there is no significant reduction in the resulting tax by application of foreign tax credits, such that the taxpayer would be required to pay more tax than it would have if the dividend had not been paid. 

Taxpayers who have fact patterns that may fit these limited circumstances may raise them with the IRS by contacting the Office of Associate Chief Counsel (International) at 202-317-3800.

WASHINGTON — As the 2020 tax season approaches, the Internal Revenue Service today encouraged taxpayers, businesses, tax professionals and others to take advantage of a variety of improved e-mail subscription services.

The e-News Subscription Service has been redesigned and updated in recent months to make it easier to subscribe to specific areas that people and organizations are interested in. Among others, the IRS offers subscription services tailored to tax exempt and government entities, small and large businesses and individuals.

The IRS currently has 20 registration-based e-News options, including: 

• IRS Tax Tips – These brief, concise tips in plain language that cover a wide-range of topics of general interest to taxpayers. They include the latest on tax scams and schemes, tax reform, tax deductions, filing extensions and amending a return. IRS Tax Tips are distributed daily during tax season and periodically throughout the year.
• IRS Newswire − Subscribers to IRS Newswire receive news releases the day they are issued. These cover a wide range of tax administration issues ranging from breaking news to details related to legal guidance.
• IRS News in Spanish (Noticias del IRS en Español) − Readers get IRS news releases, tax tips and updates in Spanish as they are released. Subscribe at Noticias del IRS en Español.
• e-News for Tax Professionals − Includes a weekly roundup of news releases and legal guidance specifically designed for the tax professional community.  Subscribing to e-News for Tax Professionals gets tax pros a weekly summary, typically delivered on Friday afternoons.
• IRS Outreach Connection − This newest IRS subscription offering delivers up-to-date materials for tax professionals and partner groups inside and outside the tax community. The material for Outreach Connection is specifically designed so subscribers can share the material with their clients or members through email, social media, internal newsletters, e-mails or external websites. Subscribe by visiting IRS.gov/outreachconnect.

For more information and other IRS subscriptions designed for specific groups, visit IRS e-News Subscriptions. The resources will help taxpayers and organizations keep up with the latest information during and after filing season.