Announcement 2022-13 advises that the Internal Revenue Service is revising the optional standard mileage rates that were provided in Notice 2022-3, 2022-2 I.R.B. 308, for substantiating the costs of operating an automobile for business, medical or moving purposes.  Beginning July 1, 2022, the rates are 62.5 cents per mile for business use of an automobile and 22 cents per mile for costs of using an automobile as a medical or moving expense.  Notice 2022-3 is modified.

Announcement 2022-13 will be in IRB:  2022-26, dated June 27, 2022.

WASHINGTON — The Internal Revenue Service today announced an increase in the optional standard mileage rate for the final 6 months of 2022. Taxpayers may use the optional standard mileage rates to calculate the deductible costs of operating an automobile for business and certain other purposes.

For the final 6 months of 2022, the standard mileage rate for business travel will be 62.5 cents per mile, up 4 cents from the rate effective at the start of the year. The new rate for deductible medical or moving expenses (available for active-duty members of the military) will be 22 cents for the remainder of 2022, up 4 cents from the rate effective at the start of 2022. These new rates become effective July 1, 2022. The IRS provided legal guidance on the new rates in Announcement 2022-13, issued today.

In recognition of recent gasoline price increases, the IRS made this special adjustment for the final months of 2022. The IRS normally updates the mileage rates once a year in the fall for the next calendar year. For travel from Jan. 1 through June 30, 2022, taxpayers should use the rates set forth in Notice 2022-03.

"The IRS is adjusting the standard mileage rates to better reflect the recent increase in fuel prices," said IRS Commissioner Chuck Rettig. "We are aware a number of unusual factors have come into play involving fuel costs, and we are taking this special step to help taxpayers, businesses and others who use this rate.”

While fuel costs are a significant factor in the mileage figure, other items enter into the calculation of mileage rates, such as depreciation and insurance and other fixed and variable costs.

The optional business standard mileage rate is used to compute the deductible costs of operating an automobile for business use in lieu of tracking actual costs. This rate is also used as a benchmark by the federal government and many businesses to reimburse their employees for mileage.

Taxpayers always have the option of calculating the actual costs of using their vehicle rather than using the standard mileage rates.

The 14 cents per mile rate for charitable organizations remains unchanged as it is set by statute.

Midyear increases in the optional mileage rates are rare, the last time the IRS made such an increase was in 2011.

Mileage Rate Changes

 

Purpose	Rates 1/1 through 6/30/22	Rates 7/1 through 12/31/22
Business	58.5	62.5
Medical/Moving	18	22
Charitable	14	14

WASHINGTON — The Internal Revenue Service today advised taxpayers who missed the April tax deadline that they can usually avoid a larger penalty by filing their 2021 federal income tax return and paying any tax due by Tuesday, June 14.

To avoid the larger penalty, the IRS must receive the return by June 14. This means that a return mailed on that date will not qualify. For that reason, the IRS urges everyone to file electronically by June 14.

In addition, taxpayers can also limit late-payment penalties and interest charges by paying their tax electronically. The fastest and easiest way to do that is with IRS Direct Pay, a free service available only on IRS.gov. Several other electronic payment options are also available. Visit IRS.gov/Payments for details.

How the penalty works
Those who miss the June 14 cutoff will normally face a minimum late-filing penalty, also known as a failure-to-file penalty. By law, If the return is more than 60 days late, the minimum penalty is either $435 or 100 percent of the unpaid tax, whichever is less. This means that the penalty will equal the tax due if the taxpayer owes $435 or less. If they owe more than $435, then the minimum penalty will be at least $435.

Under the normal calculation, this penalty is 5% of the unpaid tax for each month or part of a month that the return is late, up to a maximum of 25%. Visit IRS.gov/Penalties for details.

The late-filing penalty will stop accruing once the taxpayer files. In addition, the separate late-payment penalty and interest will stop accruing as soon as the tax is paid. The taxpayer need not figure any of these charges. Instead, the IRS will bill them for any amount due.  

Other filing deadline rules
Some taxpayers get more time to file, even if they didn’t request an extension. These special deadlines affect penalty and interest calculations for those who qualify, such as members of the military serving in combat zones, taxpayers living outside the U.S. and those living in declared disaster areas.

Combat zone taxpayers
Military service members and eligible support personnel serving in a combat zone have at least 180 days after they leave the combat zone to file their tax returns and pay any tax due. A complete list of designated combat zone localities can be found in Publication 3, Armed Forces' Tax Guide, available on IRS.gov.

Combat zone extensions also give affected taxpayers more time for a variety of other tax-related actions, including contributing to an IRA. Various circumstances affect the exact length of the extension available to taxpayers. Details, including examples illustrating how these extensions are calculated, are in the Extensions of Deadlines section in Publication 3.

Taxpayers outside the United States
U.S. citizens and resident aliens who live and work outside the U.S. and Puerto Rico have until June 15, 2022, to file their 2021 tax returns and pay any tax due.

The special June 15 deadline also applies to members of the military on duty outside the U.S. and Puerto Rico who do not qualify for the longer combat zone extension. Affected taxpayers should attach a statement to their return explaining which of these situations apply.

Though taxpayers abroad get more time to pay without penalty for late payment, interest is due on any unpaid tax from this year’s April 18 deadline. The interest rate is currently 4% per year, compounded daily. The interest rate rises to 5% on July 1, 2022. For more information about the special tax rules for U.S. taxpayers abroad, see Publication 54, Tax Guide for U.S. Citizens and Resident Aliens Abroad, on IRS.gov.

Disaster Areas
The IRS automatically provides filing and penalty relief to any taxpayer with an IRS address of record located in a federally declared disaster area when at least one area qualifies for FEMA's Individual Assistance program. Ordinarily, this means that taxpayers need not contact the IRS to get disaster tax relief. For details on all available relief, visit the Around the Nation page on IRS.gov.

Penalty relief for some
Taxpayers who have filed and paid on time and have not been assessed any penalties for the past three years often qualify to have the penalty abated. See the First-Time Penalty Abatement page on IRS.gov. A taxpayer who does not qualify for this relief may still qualify for penalty relief if their failure to file or pay on time was due to reasonable cause and not willful neglect. Anyone who receives a penalty notice from the IRS should read it carefully and follow its instructions for requesting relief. See Penalty Relief in IRS.gov for the types of penalty relief and how to make the request.

In addition to penalties, interest will be charged on any tax not paid by the regular April due date. For individual taxpayers, it’s the federal short-term interest rate plus 3 percentage points. This means that until June 30, the rate is 4% per year, compounded daily. Starting July 1, 2022, through September 30, 2022, the rate will be 5% per year, compounded daily. Interest rates are subject to change quarterly.

Interest stops accruing as soon as the tax is paid in full. By law, interest cannot be abated.

Ways to pay
Many taxpayers mistakenly delay filing because they are unable to pay what they owe. Often, these taxpayers qualify for one of the payment options available from the IRS. These include:

• Installment Agreement – An installment agreement, or payment plan, allows a taxpayer to pay over time. Individuals who owe $50,000 or less in combined tax, penalties and interest can request a payment plan using the IRS’s Online Payment Agreement application.

Those who have a balance under $100,000 may also qualify for a short-term payment plan of up to 180 days. The plan can be set up in minutes and requesters receive immediate notification of approval. To reduce the chance of default and avoid having to write and mail a check each month, taxpayers can select the direct debit option for making these payments. For other ways to set up a payment plan, visit Payment Plans, Installment Agreements.

• Offer in Compromise — Some struggling taxpayers may qualify to settle their tax bill for less than the amount they owe by submitting an offer in compromise. To help determine eligibility, use the Offer in Compromise Pre-Qualifier tool.

Check withholding

Taxpayers who owe tax for 2021 can avoid having the same problem for 2022 by increasing the amount of tax withheld from their paychecks. For help determining the right amount to withhold, use the Tax Withholding Estimator on IRS.gov.

WASHINGTON – The Internal Revenue Service today announced that spear phishing is the 8th item on the 2022 "Dirty Dozen" scams warning list and a serious problem because it can be tailored to attack and steal the computer system credentials of any small business with a client data base, such as tax professionals' firms.

"Tax professionals generally relax a little after filing season and many take a well-deserved vacation but don't let your IT defenses down," said IRS Commissioner Chuck Rettig. "Spear phishing remains one of the biggest threats to the tax industry and other client-based enterprises."

Spear phishing is an email scam that attempts to steal a tax professional's software preparation credentials. These thieves try to steal client data and tax preparers' identities in an attempt to file fraudulent tax returns for refunds. Spear phishing can be tailored to attack any type of business or organization, so everyone needs to be on the lookout and not rush to act when a strange email comes in.

The IRS has compiled the annual “Dirty Dozen” list for more than 20 years as a way of alerting taxpayers and the tax professional community about scams and schemes. The list is not a legal document or a literal listing of agency enforcement priorities. It is designed to raise awareness among a variety of audiences that may not always be aware of developments involving tax administration.

“Dirty Dozen” scams tend to be most prevalent during the filing season but criminals are busy all year long.

The IRS, state tax agencies and the nation’s tax community – working together as the Security Summit – continue to see an increase in this scheme attacking the tax professional community.

The latest phishing email uses the IRS logo and a variety of subject lines such as "Action Required: Your account has now been put on hold." The IRS has observed similar bogus emails that claim to be from a "tax preparation application provider." One such variation offers an "unusual activity report" and a solution link for the recipient to restore their account.

Emails claiming "Your account has been put on hold" are scams. The scam email will send users to a website that shows the logos of several popular tax software preparation providers. Clicking on one of these logos will prompt a request for tax preparer account credentials.

The IRS warns tax pros not to respond or take any of the steps outlined in the email. Similar emails include malicious links or attachments that are set up to steal information or to download malware onto the tax professional's computer.

In this case, if recipients enter their credentials into the pop-up window, thieves can use this information to file fraudulent returns by using credentials that were provided by the tax professional. For more information, see IR-2022-36.

WASHINGTON – Suspicious communications in all its forms designed to either trick, surprise or scare someone into responding before thinking is No. 7 on the 2022 "Dirty Dozen" scams warning list, the Internal Revenue Service announced today, warning everyone to be on the lookout for bogus calls, texts, emails and posts online to gain trust or steal.

Criminals have used these methods for years and they persist because these tricks work enough times to keep the scammers at it. Victims are tricked into providing sensitive personal financial information, money or other information. This can be used to file false tax returns and tap into financial accounts, among other schemes.

“If you are surprised or scared by a call or text, it’s likely a scam so proceed with extreme caution,” said IRS Commissioner Chuck Rettig. “I urge everyone to verify a suspicious email or other communication independently of the message in question.”

The IRS has compiled the annual Dirty Dozen list for more than 20 years as a way of alerting taxpayers and the tax professional community about scams and schemes. The list is not a legal document or a literal listing of agency enforcement priorities. It is designed to raise awareness among a variety of audiences that may not always be aware of developments involving tax administration.

As part of the Security Summit effort with the states and the nation’s tax industry, the IRS has made great strides in preventing and reducing tax-related identity theft. But it remains a serious threat to taxpayers and tax professionals who don't adequately protect Social Security numbers (SSN) and other personal information.

For example, criminals can quickly file a fake tax return using a stolen SSN in the hope that it has not already appeared on another filed return. People frequently don't know they are a victim of identity theft until they are notified by the IRS of a possible issue with their tax return or their return is rejected because the SSN appears on a return already filed.

Here are some common scams the IRS continues to see. Taxpayers should take extra caution with these schemes, which continue to evolve and change:

Text message scams: These scams are sent to taxpayers' smartphones and can reference things like COVID-19 and/or "stimulus payments." These messages often contain bogus links claiming to be IRS websites or other online tools. Other than IRS Secure Access, the IRS does not use text messages to discuss personal tax issues, such as those involving bills or refunds. The IRS also will not send taxpayers messages via social media platforms.

If a taxpayer receives an unsolicited SMS/text that appears to be from either the IRS or a program closely linked to the IRS, the taxpayer should take a screenshot of the text message and include the screenshot in an email to phishing@irs.gov with the following information:

Email phishing scams: The IRS does not initiate contact with taxpayers by email to request personal or financial information. The IRS initiates most contacts through regular mail. If a taxpayer receives an unsolicited fraudulent email that appears to be from either the IRS or a program closely linked to the IRS, report it by sending the email as an attachment to phishing@irs.gov. The Report Phishing and Online Scams page at IRS.gov provides complete details.

Phone scams: The IRS does not leave pre-recorded, urgent or threatening messages. In many variations of the phone scam, victims are told if they do not call back, a warrant will be issued for their arrest. Other verbal threats include law-enforcement agency intervention, deportation or revocation of licenses.

Criminals can fake or "spoof" caller ID numbers to appear to be anywhere in the country, including from an IRS office. This prevents taxpayers from being able to verify the caller’s true number. Fraudsters also have spoofed local sheriff's offices, state departments of motor vehicles, federal agencies and others, to convince taxpayers the call is legitimate.

The IRS (and its authorized private collection agencies) will never:

Generally, the IRS will first mail a bill to any taxpayer who owes taxes. All tax payments should only be made payable to the U.S. Treasury and checks should never be made payable to third parties. For anyone who doesn't owe taxes and has no reason to think they do: Do not give out any information. Hang up immediately. For more information, see IR-2022-25.

WASHINGTON — The Internal Revenue Service reminds taxpayers who pay estimated taxes that the deadline to pay their second quarter tax liability is June 15.

Taxes are pay-as-you-go
This means taxpayers need to pay most of the tax they expect to owe during the year, as income is received. There are two ways to do that:

Estimated tax is the method used to pay tax on income that isn’t subject to withholding. This includes income from self-employment, interest, dividends, rent, gains from the sale of assets,
prizes and awards.

Taxpayers may also have to pay estimated tax if the amount of income tax being withheld from their salary, pension or other income isn’t enough. If necessary, those who receive a salary or wages can avoid having to pay estimated taxes by asking their employer to withhold more tax from their earnings. To do this, taxpayers should submit a new Form W-4 to their employer. There is a special line on Form W-4 for them to enter the additional amount they want their employer to withhold.

Who must pay estimated tax?
Individuals, including sole proprietors, partners and S corporation shareholders, generally have to make estimated tax payments if they expect to have a tax liability of $1,000 or more when they file their return.

Individual taxpayers can use the IRS Interactive Tax Assistant online to see if they are required to pay estimated taxes. They can also see the worksheet in Form 1040-ES, Estimated Tax for Individuals, for more details on who must pay estimated tax.

Corporations generally have to make estimated tax payments if they expect to owe tax of $500 or more when they file their return. Corporations can see Form 1120-W, Estimated Tax for Corporations, for more information.

Publication 505, Tax Withholding and Estimated Tax, has additional details, including worksheets and examples, that can be especially helpful to those who have dividend or capital gain income, owe alternative minimum tax or self-employment tax, or have other special situations.

How to avoid an underpayment penalty
Taxpayers can avoid an underpayment penalty by owing less than $1,000 at tax time or by paying most of their taxes during the year. Generally, for 2022 that means making payments of at least 90% of the tax expected on their 2022 return, or taxpayers who pay at least 100 percent of the tax shown on their return for tax year 2021.

Special rules apply to some groups of taxpayers, such as farmers, fishers, certain higher income taxpayers, casualty and disaster victims, those who recently became disabled, recent retirees and those who receive income unevenly during the year. For more information, refer to Form 1040-ES.

Generally, taxpayers should make estimated tax payments in four equal amounts to avoid a penalty. However, if they receive income unevenly during the year, they may be able to vary the amounts of the payments to avoid or lower the penalty by using the annualized installment method. Taxpayers can use Form 2210, Underpayment of Estimated Tax by Individuals, Estates, and Trusts, to see if they owe a penalty for underpaying their estimated tax.

Third quarter payments are due September 15 and the final estimated tax payment for tax year 2022 is due on Jan. 17, 2023.

Tax Withholding Estimator
The Tax Withholding Estimator offers a step-by-step method for effectively ensuring taxpayers have the right amount of tax withheld from their paychecks or other income that is subject to withholding.

Using the Tax Withholding Estimator can help taxpayers prevent having too little tax withheld and facing an unexpected tax bill or penalty at tax time next year.

How to pay estimated taxes
An electronic payment is the fastest, easiest and most secure way for individuals to make an estimated tax payment. Taxpayers can securely log into their IRS Online Account or use IRS Direct Pay to submit a payment from their checking or savings account. Taxpayers can also pay using a debit, credit card or digital wallet. Taxpayers should note that the payment processor, not the IRS, charges a fee for debit and credit card payments. Both Direct Pay and the pay by debit, credit card or digital wallet options are available online at IRS.gov/payments and through the IRS2Go app.

Taxpayers can also use the Electronic Federal Tax Payment System (EFTPS) to make an estimated tax payment.

Corporations must use electronic funds transfer to make all federal tax deposits (such as deposits of employment, excise and corporate income tax). This includes installment payments of estimated tax. Generally, an electronic funds transfer is made using the Electronic Federal Tax Payment System (EFTPS). However, if the corporation does not want to use EFTPS, it can arrange for its tax professional, financial institution, payroll service, or other trusted third party to make electronic deposits on its behalf.

If taxpayers opt to mail a check or money order, they should make them payable to the "United States Treasury."

Form 1040-ES, Estimated Tax for Individuals, includes instructions to help taxpayers figure their estimated taxes. For information on all payment options, visit IRS.gov/payments.

IRS.gov assistance 24/7
Tax help is available 24/7 on IRS.gov. The IRS website offers a variety of online tools to help taxpayers find answers to common tax questions. For example, taxpayers can search the Interactive Tax Assistant, Tax Topics and Frequently Asked Questions to get answers to common questions.

The IRS is continuing to expand ways to communicate to taxpayers who prefer to get tax information in other languages. The IRS has posted translated tax resources in 20 other languages on IRS.gov. For more information, see We Speak Your Language.

WASHINGTON – As the 6th item on the 2022 "Dirty Dozen" scams warning list, the Internal Revenue Service today cautioned taxpayers with pending tax bills to contact the IRS directly and not go to unscrupulous tax companies that use local advertising and falsely claiming they can resolve unpaid taxes for pennies on the dollar.

“No one can get a better deal for taxpayers, than they can usually get for themselves by working directly with the IRS to resolve their tax issues,” said IRS Commissioner Chuck Rettig. “Taxpayers can check online for their best deal, as well as calling a specialized collection line where they can get fast service by using voice and chat bots or opting to speak with a live phone assistor."

Offer in Compromise (OIC) "mills" make outlandish claims usually in local advertising regarding how they can settle a person’s tax debt for pennies on the dollar. The reality usually is that taxpayers pay the OIC mill a fee to get the same deal they could have gotten on their own by working directly with the IRS.

The IRS has compiled the annual Dirty Dozen list for more than 20 years as a way of alerting taxpayers and the tax professional community about scams and schemes. The list is not a legal document or a literal listing of agency enforcement priorities. It is designed to raise awareness among a variety of audiences that may not always be aware of developments involving tax administration.

OIC mills are a problem all year long but tend to be more visible right after the filing season is over and taxpayers are trying to resolve their tax issues perhaps after receiving a balance due notice in the mail.

For those who feel they need help, there are many reputable tax professionals available, and there are important tools that can help people find the right practitioner for their needs. IRS.gov is a good place to start scoping out what to do.

These "mills" contort the IRS program into something it's not — misleading people with no chance of meeting the requirements while charging excessive fees, often thousands of dollars.

An "offer," or OIC, is an agreement between a taxpayer and the IRS that resolves the taxpayer's tax debt. The IRS has the authority to settle, or "compromise," federal tax liabilities by accepting less than full payment under certain circumstances. However, some promoters are inappropriately advising indebted taxpayers to file an OIC application with the IRS, even though the promoters know the person won't qualify. This costs honest taxpayers money and time.

Before taxpayers start investing time to do the paperwork necessary to submit an offer, they’ll want to check out the IRS’s Offer in Compromise Pre-Qualifier Tool to make sure they’re eligible to file one. (Note: even though individuals and businesses can submit an offer, the tool is currently only available to individuals.)

The IRS also created an OIC video playlist that leads taxpayers through a series of steps and forms to help them calculate an appropriate offer based on their assets, income, expenses and future earning potential. Find these helpful, easy to navigate videos at irsvideos.gov/oic.

The IRS reminds taxpayers that under the First Time Penalty Abatement policy, taxpayers can go directly to the IRS for administrative relief from a penalty that would otherwise be added to their tax debt.

OIC mills are one example of unscrupulous tax preparers. Taxpayers should be wary of unscrupulous “ghost” preparers and aggressive promises of manufacturing a bigger refund.

Ghost preparers: Although most tax preparers are ethical and trustworthy, taxpayers should be wary of preparers who won't sign the tax returns they prepare, often referred to as ghost preparers. For e-filed returns, the "ghost" will prepare the return, 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 (PTIN). Paid preparers must sign and include their PTIN on the return.

Inflated refunds: Not signing a return is a red flag that the paid preparer may be looking to make a quick profit by promising a big refund or charging fees based on the size of the refund.
Unscrupulous tax return preparers may also:

Choose 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.

Taxpayers are legally responsible for what’s on their tax return even if it is prepared by someone else.

WASHINGTON — The Internal Revenue Service today said that a recent court decision upholds its long-standing position regarding abusive microcaptive insurance transactions. Taxpayers should be alert to these schemes, normally peddled by promoters, as they will ultimately cost them.

On May 12, 2022, in Reserve Mechanical Corp. v. Commissioner, the United States Court of Appeals for the Tenth Circuit appropriately upheld the Internal Revenue Service’s position on abusive microcaptive insurance transactions. The Tenth Circuit affirmed the Tax Court’s decision holding that the taxpayer was not engaged in the insurance business and that the purported insurance premiums it received were therefore taxable. After the Tax Court decided in favor of the IRS in numerous cases involving microcaptives, Reserve Mechanical is the first appellate decision recognizing the IRS’ position that these abusive transactions are shams.

The IRS encourages anyone considering entering a promoted microcaptive insurance transaction to first speak with a qualified, independent advisor. These transactions will result in serious economic loss to taxpayers, including the loss of deductions, required income inclusion and penalties. Taxpayers should understand that the IRS has asserted in many of these cases that the microcaptive insurance transactions lack economic substance and that when transactions are held to lack economic substance, then a 20% penalty (40% if undisclosed) will automatically apply, and it cannot be waived or reduced by the IRS or the courts.

Likewise, taxpayers who have already engaged in such a transaction should speak with a qualified independent tax advisor about their options. The IRS previously offered settlement opportunities for abusive microcaptive transactions, and for taxpayers who come forward seeking to resolve their case, the IRS will consider providing a resolution opportunity as appropriate.

The IRS and Department of Justice will use all available legal options to challenge improper attempts to avoid or evade U.S. income tax, regardless of how long it takes for these cases to wind their way through the courts.  The IRS will also aggressively pursue penalties for all participants in these abusive transactions. 

WASHINGTON – The Internal Revenue Service today kicked off the week with the 5th item on its 2022 annual "Dirty Dozen" scams warning list, with a sad reminder that criminals still use the COVID-19 pandemic to steal people's money and identity with bogus emails, social media posts and unexpected phone calls, among other things. 

These scams can take a variety of forms, including using unemployment information and fake job offers to steal money and information from people. All of these efforts can lead to sensitive personal information being stolen, with scammers using this to try filing a fraudulent tax return as well as harming victims in other ways. 

"Scammers continue using the pandemic as a device to scare or confuse potential victims into handing over their hard-earned money or personal information,” said IRS Commissioner Chuck Rettig. "I urge everyone to be leery of suspicious calls, texts and emails promising benefits that don’t exist.” 

The IRS has compiled the annual Dirty Dozen list for more than 20 years as a way of alerting taxpayers and the tax professional community about scams and schemes. The list is not a legal document or a literal listing of agency enforcement priorities. It is designed to raise awareness among a variety of audiences that may not always be aware of developments involving tax administration. 

“Caution and awareness are our best lines of defense against these criminals,” Rettig added. “Everyone should verify information on a trusted government website, such as IRS.gov.”

A common scam the IRS continues to see during this period involves using crises that affect all or most people in the nation, such as the COVID-19 pandemic. Some of the scams for which people should continue to be on the lookout include: 

Economic Impact Payment and tax refund scams: Identity thieves who try to use Economic Impact Payments (EIPs), also known as stimulus payments, are a continuing threat to individuals. Similar to tax refund scams, taxpayers should watch out for these tell-tale signs of a scam: 

Any text messages, random incoming phone calls or emails inquiring about bank account information, requesting recipients to click a link or verify data should be considered suspicious and deleted without opening. This includes not just stimulus payments, but tax refunds and other common issues.

Remember, the IRS won't initiate contact by phone, email, text or social media asking for Social Security numbers or other personal or financial information related to Economic Impact Payments. Also be alert to mailbox theft. Routinely check your mail and report suspected mail losses to postal inspectors. 

Reminder: The IRS has issued all Economic Impact Payments. Most eligible people already received their stimulus payments. People who are missing a stimulus payment or got less than the full amount may be eligible to claim a Recovery Rebate Credit on their 2020 or 2021 federal tax return. Taxpayers should remember that the IRS website, IRS.gov, is the agency's official website for information on payments, refunds and other tax information.

Unemployment fraud leading to inaccurate taxpayer 1099-Gs: Because of the pandemic, many taxpayers lost their jobs and received unemployment compensation from their state. However, scammers also took advantage of the pandemic by filing fraudulent claims for unemployment compensation using stolen personal information of individuals who had not filed claims. Payments made on these fraudulent claims went to the identity thieves. 

Taxpayers should also be on the lookout for a Form 1099-G reporting unemployment compensation they didn't receive. For people in this situation, the IRS urges them to contact their appropriate state agency for a corrected form. If a corrected form cannot be obtained so that a taxpayer can file a timely tax return, taxpayers should complete their return claiming only the unemployment compensation and other income they actually received. See Identity Theft and Unemployment Benefits for tax details and DOL.gov/fraud for state-by-state reporting information. 

Fake employment offers posted on social media: There have been many reports of fake job postings on social media. The pandemic created many newly unemployed people eager to seek new employment. These fake posts entice their victims to provide their personal financial information. This creates added tax risk for people because this information in turn can be used to file a fraudulent tax return for a fraudulent refund or used in some other criminal endeavor. 

Fake charities that steal your money: Bogus charities are always a problem. They tend to be a bigger threat when there is a national crisis like the pandemic.

Taxpayers who give money or goods to a charity may be able to claim a deduction on their federal tax return. Taxpayers must donate to a qualified charity to get a deduction. To check the status of a charity, use the IRS Tax Exempt Organization Search tool. 

Here are some tips to remember about fake charity scams: 

• Individuals should never let any caller pressure them. A legitimate charity will be happy to get a donation at any time, so there's no rush. Donors are encouraged to take time to do the research.
• Potential donors should ask the fundraiser for the charity's exact name, web address and mailing address, so it can be confirmed later. Some dishonest telemarketers use names that sound like large well-known charities to confuse people.
• Be careful how a donation is paid. Donors should not work with charities that ask them to pay by giving numbers from a gift card or by wiring money. That's how scammers ask people to pay. It's safest to pay by credit card or check — and only after having done some research on the charity.

For more information about avoiding fake charities, visit the Federal Trade Commission website

WASHINGTON — The Internal Revenue Service is encouraging taxpayers who have yet to file their 2021 tax return – including those who requested an extension of time – to file a complete and accurate return electronically as early as possible once they have all their information together. There’s no need to wait until the October deadline. 

Taxpayers who requested an extension have until October 17 this year to file their tax return. However, if a taxpayer has all the necessary information to file an accurate return, filing before summer vacation can be a win-win. 

“IRS employees continue working hard to process tax returns and address our inventory issues,” said IRS Commissioner Chuck Rettig. “We continue to urge people to file electronically and do it as soon as possible. Even if people have an extension to file until October, sending the tax return as soon as possible can either help get them a refund quicker or it can save them money if they owe by avoiding additional interest and penalties.” 

Filing electronically as soon as possible can also help taxpayers who did not file an extension and missed the April deadline to avoid further penalties and interest if they owe taxes. 

File electronically and choose direct deposit

Generally, people who choose not to file a tax return because they didn't earn enough money to be required to file won't receive a penalty if they are owed a refund. But they may miss out on receiving a refund if they don’t file. The IRS advises individuals who still need to file a 2021 tax return to file electronically and, if due a refund, to choose direct deposit. 

Filing electronically is fast, accurate and secure, and when an individual chooses direct deposit, their refund goes directly from the IRS into their bank or financial account getting them their refund in the fastest time possible. If they have a prepaid debit card, they may be able to have their refund applied to the card by providing the account and routing numbers to the IRS. The IRS processes most e-filed returns and issues direct deposit refunds in less than three weeks. 

Here’s a tip to help with e-filing a 2021 tax return for those still waiting on their 2020 tax return to be processed: To validate and successfully submit an electronically filed tax return to the IRS, taxpayers need their Adjusted Gross Income, or AGI, from their most recent tax return. Those waiting on their 2020 tax return can still file their 2021 return by entering $0 for their 2020 AGI on their 2021 tax return. Remember, if using the same tax preparation software as last year, this field will auto-populate. 

Taxpayers who haven’t filed a 2021 tax return yet – including extension filers – can file electronically any time before the October deadline and avoid the last-minute rush to file. 

Find help on IRS.gov

People may be waiting to file because they need help or more information, have a more complicated tax situation, or owe taxes. The IRS has resources to help taxpayers get the answers they need so they can file an accurate return. Take the time to file an accurate tax return, but don’t wait until the last minute and risk missing the October deadline. 

Tools on the IRS website are easy to use and available 24 hours a day. Millions of people use them to find information about their accounts, get answers to tax questions or file and pay taxes. The online tools include important, special steps related to Economic Impact Payments and advance Child Tax Credit payments. 

IRS.gov has many online tools and resources ranging from tax preparation and refund tracking tools, to tax law research tools like the Interactive Tax Assistant and answers for Frequently Asked Questions on dozens of subjects. 

Payment options

Submitting a tax return and paying any amount owed as soon as possible can help taxpayers avoid further interest and penalties. 

Taxpayers who owe taxes can review all payment options online. These include paying taxes through an Online Account with IRS Direct Pay or paying by debit card, credit card or digital wallet. The IRS has options for people who can't pay their taxes, including applying for a payment plan on IRS.gov. 

IRS Free File

Eligible individuals – including those who requested an extension to file – can use the IRS Free File program to prepare and file their federal tax return for free. The program offers 70% of all taxpayers the choice of several brand-name tax preparation software packages to use at no cost. Those who earned less than $73,000 in 2021 can choose which package is best for them. Some even offer free state tax return preparation. Those that earned more have the option to use IRS Free File Fillable Forms. 

MilTax online software is also available for members of the military and certain veterans, regardless of income. This software is offered through the Department of Defense. Eligible taxpayers can use MilTax to prepare and electronically file their federal tax returns and up to three state returns, for free. 

Volunteer Income Tax Assistance

The IRS's Volunteer Income Tax Assistance (VITA) program still offers face-to-face help preparing taxes in some locations in communities across the country. It offers free basic tax return preparation to people who generally make $58,000 or less and people with disabilities or limited English-speaking taxpayers. 

The VITA/TCE Site Locator can help eligible taxpayers find the nearest community-based site staffed by IRS-trained and certified volunteers. Taxpayers can use the locator tool to see if there’s an available site still open near them. 

Tax professionals

Many people use a trusted tax professional to help guide them through the process of doing their taxes and avoiding errors. 

There are various types of tax return preparers, including certified public accountants, enrolled agents, attorneys and many others who don't have a professional credential. 

Because tax professionals have access to an individual’s personal and financial information, it’s important to choose a tax preparerwisely. 

For taxpayers who want help with their taxes, this online directory can help them find a tax professional in their area.