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RMD Repayment or Rollover Deadline - Did You Know? The deadline to return or rollover a Required Minimum Distribution (RMD) for IRA owners, beneficiaries or workplace retirement plan participants is coming up on Monday, August 31. The CARES Act allows most taxpayers with an eligible retirement account, such as a 401(k), 403(b) or traditional IRA, to skip their required minimum distributions (RMDs) for 2020 without penalty. Individuals who received the RMD, including those who... turned 70 in 2019, have the option to return the distribution to their account or other qualified plan. They may also have the option of rolling over to another IRA or qualified retirement plan by August 31, 2020 to avoid taxes on the RMD. Please note that the suspension of the RMD does not apply to qualified defined benefit plans. A tax and financial professional can help you determine the best strategy for handling your 2020 retirement account RMDs.

Charitable Cash Contribution Limits for 2020 Did You Know? As part of the U.S. Treasury's ongoing COVID-19 (coronavirus) relief programs for taxpayers, the IRS has made temporary changes to the rules for deducting charitable contributions on federal tax returns. Normally, taxpayers who itemize deductions on Schedule A can deduct cash charitable contributions up to a specified limit, usually 60% of their adjusted gross income (AGI). For 2020, however, qualified contributions... may be deducted up to 100% of the taxpayer's AGI. (For corporations, the 2020 deduction limit is 25% of taxable income.) Furthermore, qualified contributions above this raised limit may be carried over as a deduction for the next tax year. To qualify for this limit suspension, a contribution must satisfy ALL of these requirements: - It is a cash contribution (that is, a direct contribution of money, not other property) - It is made to a qualifying charitable organization - It is made during calendar year 2020. Note that non-cash property contributions made in 2020 do not qualify for this limit suspension. However, these contributions may still be deducted up to the normal limits (typically 50% of AGI minus the amount of any deducted cash contributions). A tax professional can help you determine if any of your 2020 charitable contributions qualify for the deduction limit suspension, and how to claim your full deduction if so. The IRS also has a tool available for checking exempt organizations: https://www.irs.gov/charities-non-prof/search-for-charities.

New Tax Scams and Identity Theft Warnings Did You Know? The IRS recently posted warnings about new and ongoing tax scams, along with other fraudulent activity related to the COVID-19 (coronavirus) pandemic. The most prevalent and dangerous scams involve identity theft, deceptive advertising, and attempts to cheat taxpayers out of their refunds or economic impact payments (EIPs, also called stimulus payments). - STEALING REFUNDS OR EIPS THROUGH IDENTITY THEFT: Some criminals... steal a taxpayer's Social Security number (SSN), and then file bogus forms with the IRS in order to receive tax refunds or other payments that rightly belong to the taxpayer. - FAKE CHARITIES: Currently, a number of fraudulent charities with names very similar to legitimate organizations are calling taxpayers, claiming that they are collecting funds to help pandemic victims. Actual charities will provide their Employer Identification Numbers (EINs) upon request, so you can look them up and verify that the callers are who they say they are. Most real charities also offer secure online contribution portals. - OFFER-IN-COMPROMISE (OIC) MILLS: You may have heard ads for agencies that can settle people's IRS debts for "pennies on the dollar." Some of these companies charge high fees to submit an OIC application to the IRS on a taxpayer's behalf. Only about one in three OIC proposals are accepted by the IRS, but the companies do not refund fees for rejected applications. If you need help applying, work only with a reputable tax professional. - FAKE PAYMENTS & REFUNDS WITH REPAYMENT DEMANDS: In this very complex scam, identity thieves first obtain a taxpayer's SSN and bank account information, then file a fake IRS return and have the refund deposited into the taxpayer's bank account. A scammer then calls the refund recipient and impersonates an IRS agent, claiming that the refund was issued by mistake and must be returned to the IRS. Often, these scammers demand the "repayment" in the form of gift cards. If you receive a mysterious payment from the IRS, especially if you then receive a phone call demanding repayment, contact your bank and the IRS immediately to report the potential scam. Above all, remember to never share your SSN or any other personal information with anyone unless you are 100% sure who they are and why they need it. If in doubt, hang up or delete the email or text message, then contact the IRS directly to inquire about the issue.

Filing Extensions and Minimizing Penalties Did You Know? Taxpayers who requested an automatic extension to file their 2019 federal income tax returns may file anytime up until October 15, 2020. Remember, however, that an automatic IRS extension is only an extension to file tax returns, NOT an extension to pay any tax owed. Taxes not paid by the July 15, 2020 payment deadline may be subject to late penalties and interest charges. Therefore, taxpayers who have not yet sent an... IRS payment that was due on July 15, including 2019 income tax and first- and second-quarter estimated tax payments for 2020, should submit a payment to the IRS as soon as possible to minimize penalties. Electronic payments may be made using the IRS online payment portal (link below). The IRS urges those who cannot pay what they owe at this time to pay whatever amount they can, and then apply for an installment plan to pay off the remaining balance. Those who did not file a 2019 federal return or automatic extension request by July 15 may face a Failure to File penalty in addition to late fees and interest. It is therefore especially important for these taxpayers to take action as soon as possible. A tax professional can help anyone trying to meet federal tax filing and payment requirements to submit the appropriate forms and applications to the IRS, and start getting back on track. IRS Online Payment Portal: https://www.irs.gov/payments

IRS Installment Payments after July 15 - Did You Know As part of the federal government's COVID-19 (coronavirus) relief programs, the U.S. Treasury allowed many taxpayers with an IRS installment payment agreement, or a pending or accepted Offer-in-Compromise (OIC), to suspend payments between April 1 and July 15, 2020. The IRS recently confirmed that to avoid penalties, affected taxpayers must resume making required payments by their first due date on or after July 15, or con...tact the IRS if they cannot do so. The IRS guidance includes the following key points: - If you currently have an installment agreement with the IRS and had your bank stop making automatic payments due to the pandemic, you should tell your bank to restart these payments by your first payment due date after July 15. If you are unable to make your payments due to coronavirus-related hardships, you may call the phone number on your IRS notice to discuss options. You may also avoid long phone wait times by submitting an online application (see link below) to revise your agreement. - If you have a pending OIC and suspended your payments, simply resume making scheduled payments by July 15. If your offer is accepted, the IRS will update the agreement to allow you to make any missed payments at the end of the offer period. - If you suspended payments on a previously approved OIC, the IRS requires that you not only resume making payments on July 15, but also make up any skipped payments by that due date. If you are unable to make up your missed payments at this time, call the phone number on your IRS notice to discuss your options. - If your IRS tax debt was referred to a private collection agency before April 1, 2020 but you suspended payments between April 1 and July 15, you will need to restart payments to the collection agency. You should also contact your collection agency representative to find out if it is appropriate to update or restructure your payment agreement based on your current circumstances. Remember also that although the IRS did not impose penalties for skipped payments during the April 1 - July 15 grace period, interest charges may still have accrued on the tax debt. Most importantly, if you are unable to make any required federal tax payment, contact the IRS as soon as possible to discuss your situation. When dealing with the IRS, it is always best to be proactive. Apply for or revise an installment payment agreement: https://www.irs.gov/pa/online-payment-agreement-application

Where's My Refund? - Did You Know You can use the IRS 'Where's my Refund' (https://www.irs.gov/refunds) tool to check the status of your refund. The 'Where's my Refund' tool is updated once daily, usually overnight. Your status is generally available within 24 hours upon the IRS receiving your e-filed return. If you have filed a paper return, the IRS is currently experiencing processing delays for paper filed returns due to limited staffing, but will process them in the order received.

Multiple IRS Deadlines Fall on July 15 Important Reminders The U.S. Treasury's COVID-19 (coronavirus) pandemic relief efforts included postponing many IRS deadlines to July 15, 2020. As a result, numerous federal tax forms and payments are due this week. The most important July 15 IRS deadlines to keep in mind include: 2019 INDIVIDUAL FEDERAL TAX RETURN FILING: U.S. resident individual and joint tax filers, along with U.S. citizens and resident aliens living abroad or on mi...litary duty, must file 2019 Form 1040 or 1040-SR and pay any tax due. If you cannot file your return by the deadline, request an automatic filing extension to October 15 by submitting Form 4868. However, if you expect to owe tax, estimate the amount and pay it by July 15 to avoid late payment penalties. (Military personnel in combat zones may be entitled to filing extensions beyond October 15.) FIRST TWO 2020 QUARTERLY ESTIMATED TAX PAYMENTS: If you earn income and either do not pay federal taxes through paycheck withholding or do not expect your withholding to cover your 2020 tax obligations, you may need to make quarterly estimated tax payments. In particular, this requirement applies to many self-employed taxpayers and gig economy workers. Your first two quarterly estimated payments for 2020 (payments for Quarter 1 and Quarter 2) are due on July 15. DEADLINE FOR 2019 IRA AND HSA CONTRIBUTIONS: You may be able to treat contributions made by July 15 to your IRA or health savings account (HSA) as 2019 contributions, provided you have not reached your 2019 contribution limit. 2019 FEDERAL TAX AND 2020 ESTIMATED TAX DEADLINES FOR CORPORATIONS: Corporations must file their 2019 federal income tax returns and pay any tax due, and also make their first two 2020 estimated income tax payments, by July 15. The IRS urges taxpayers who cannot pay the tax they owe to file by the July 15 deadline and pay what they can. By making a payment in any amount now and setting up a payment plan, you may be able to significantly reduce penalties and interest charges.

Unclaimed 2016 IRS Refunds Deadline Did You Know? The IRS has issued a reminder that time is running out to claim your 2016 tax refund if you did not file a 2016 federal return. The U.S. Treasury is currently holding unclaimed 2016 refunds totaling over $1.5 billion. The deadline to file a 2016 IRS return and claim your refund is July 15, 2020. If you are entitled to a refund for tax year 2016 (or any later year), you will not be charged a penalty for submitting your return... after the original filing deadline. However, the IRS only allows a three-year window to claim a tax refund. Since the original filing due date for 2016 returns was April 15, 2017, this three-year window would have normally expired on April 15, 2020. In response to the COVID-19 (coronavirus) pandemic, the IRS extended the final deadline to July 15. After that date, unclaimed 2016 federal tax refunds will become the property of the U.S. Treasury. If you have not yet filed your 2016 return, file today to claim your refund before it's too late.

Extended 2020 Estimated Tax Deadlines and Special Rules for Irregular Income If you receive income that does not have taxes withheld, such as business, self-employment or investment income, you may need to make quarterly estimated tax payments to avoid incurring IRS penalties when you file your 2020 tax return. Ordinarily, the first two quarterly estimated tax due dates of the year are April 15 and June 15. However, the IRS extended both of these deadlines to July 15, 2020 du...e to the COVID-19 pandemic. You may make your payments for the first two quarters of this year (either separately or as one combined payment) at any time until that date. The deadlines for the third and fourth quarters currently remain September 15, 2020 and January 15, 2021, respectively. You may skip the January 15 payment if you file your 2020 return by February 1, 2021 and pay all tax due. The IRS expects most estimated tax payers to pay the same amount each quarter; a penalty may be assessed if any quarterly payment is too low. For example, whether you make separate payments for the first two quarters of 2020 or combine them into one July 15 payment, the total tax you pay by that date (including estimated payments and any paycheck withholding) must usually be at least 50% of your required minimum payment for the year. Generally, the minimum amount you must pay during the course of 2020 is either 100% of your 2019 tax or 90% of your 2020 tax, whichever is less. However, if your income is irregular throughout the yearfor example, if you had very low income during the first half of 2020 but will begin earning more in Julyyou may qualify to make unequal estimated tax payments, or even skip one or more payments. In addition, if you make a substantial portion of your income from fishing or farming, you may be able to make a single, year-end estimated tax payment instead of paying quarterly. A tax professional can help you determine your estimated tax payment requirements for 2020, and how to adequately document your income fluctuations if you choose to make unequal payments.

Discarded or Lost COVID-19 Stimulus Prepaid Debit Cards Did You Know? In addition to direct deposits and paper checks, the IRS is sending some Coronavirus Economic Impact Payments (EIPs, also called stimulus payments) to eligible Americans by prepaid debit card. Because these debit cards are not sent out in standard U.S. Treasury envelopes, some recipients may have mistaken them for junk mail and thrown them away. Fortunately, if you accidentally discarded an EIP prepaid de...bit card, you can request a free replacement. EIP cards arrive in a plain envelope from Money Network Cardholder Services. The front of the card displays a VISA logo, while the back shows a MetaBank logo and the title Money Network. If you believe you may have received an EIP card and thrown it out, call Money Network at 1-800-240-8100 and choose the Lost or Stolen Card option. The bank will deactivate your original card and send you a new one. The first replacement card is free, but a fee of $7.50 will be charged for any subsequent replacement cards. If you qualify for an EIP but your payment has not yet been sent, you may be able to request that your payment be added to a prepaid debit card you already have. Visit the EIP Get My Payment portal or Non-Filers: Enter Payment Info Here portal to learn more (links are below). Get My Payment portal (for those required to file federal income tax returns): https://www.irs.gov/coronavirus/get-my-payment Non-Filers: Enter Payment Info Here portal: https://www.irs.gov/coro/non-filers-enter-payment-info-here EIP Card Website: https://www.eipcard.com/

Tax Rules for Tuition Refunds and Section 529 Plans Did You Know? Many families and students may have received partial or complete refunds of school tuition and fees during the spring of 2020 as a result of the COVID-19 (coronavirus) pandemic. If you paid for these expenses using a Section 529 education savings plan (also called a Qualified Tuition Program, or QTP), your refund could be taxable income, and/or subject to a 10% penalty on interest earned by the account. Howev...er, it is usually possible to avoid these taxes and penalties by properly handling the refunded money and carefully documenting your transactions. One option is to redeposit the funds into the same account from which they were originally taken, or a different QTP account set up for the same child. Generally, such redeposits or rollovers do not count toward your annual contribution limit. To avoid tax implications, a redeposit or rollover of a QTP education expense refund ordinarily must be completed within 60 days of receiving the refund. However, special tax rules for the spring of 2020 may enable you to complete the reinvestment transaction within 60 days or by July 15, whichever comes later. Be sure to keep documentation of all actions taken. If redepositing your refund is impractical, you may still be able to avoid paying tax on it by using the funds for other qualifying education expenses. In addition to tuition and fees, qualifying expenses may include computers and education-related software that will be used primarily by a child who is enrolled at an eligible postsecondary school. A tax professional can help you identify your best option to manage your refund, ensure that you complete any necessary transactions by the appropriate deadline, and maintain all records required by IRS rules.

Key Facts About IRS Economic Impact Payments (EIPs) Did You Know? Although the IRS has sent out over 100 million Economic Impact Payments (also called stimulus payments), some Americans are still waiting to receive their payments. Even if you have gotten your EIP, you may have questions about how the money affects your income or taxes. The IRS recently issued answers to some of the most common questions about EIPs, including: - EIPs are NOT taxable income. You do not need t...o report your EIP on your 2020 tax return or pay tax on it, and it will not affect your eligibility for government programs with income limits. - If you are not required to file a federal tax return but receive Form SSA-1099 or RRB-1099 for Social Security or Railroad Retirement benefits, you can use the IRS Get My Payment portal (see below) to check on the status of your EIP. - If your direct deposit information has changed since you last filed a tax return and received a refund, you can NOT use the Get My Payment portal to provide the IRS with new account information. If your old account number is no longer valid or the account has been closed, the bank will return your EIP to the IRS. The Get My Payment portal will then be updated to show that you will receive a check in the mail, with an estimated delivery date. - If you are a U.S. citizen living abroad, you qualify to receive an EIP as long as you do not exceed the income limit, are eligible to file IRS Form 1040 or 1040 SR, have a valid Social Security Number (SSN) and cannot be claimed as a dependent by another taxpayer. The basic income limit is $99,000 for individuals or $198,000 for joint filers. Finally, the IRS reminds all Americans to stay alert for scams related to EIPs. You should ONLY provide your private information to the IRS through the official Get My Payment portal. Anyone who requests your bank or tax information in order to help you get your EIP, or asks you to sign your EIP check over to them, is a scammer. Hang up or delete the message immediately. IRS Get My Payment Portal: https://www.irs.gov/coronavirus/get-my-payment

Economic Impact Payments by Prepaid Debit Card Did You Know? As part of the U.S. Treasury's ongoing effort to get COVID-19 Economic Impact Payments (EIPs, also called stimulus payments) to all eligible Americans, the IRS has begun sending payments by prepaid debit card in addition to direct deposits and paper checks. Many people who are still waiting for their payments will receive these prepaid cards in the coming weeks. You can do any of the following with an EIP prepaid ...debit card with no transaction fees, until you use up the balance on the card: - Make purchases anywhere Visa is accepted, including online and in-person stores - Transfer funds from the card to your bank account - Get cash from in-network ATMs (the ATM will tell you if it is not in-network, which could result in fees being charged) - Check your card balance 24/7 by phone, online, or by using the mobile app Prepaid debit cards also offer built-in protection against loss, fraud, theft or other unauthorized use. If you already have a prepaid debit card and the IRS has not yet scheduled your payment, you may be able to request that your EIP be loaded directly onto your existing card. To find out if you are eligible for this option, visit either the Get My Payment IRS portal or the Non-Filers: Enter Payment Info Here page (see links below). NOTE: EIP prepaid debit cards will NOT come in an IRS or U.S. Treasury envelope. Instead, the card will arrive in a plain envelope from Money Network Cardholder Services, with a letter explaining that the card has been preloaded with your EIP. The front of the card has a Visa logo, while the back displays the name of the issuing bank, Metabank, N.A. The letter also explains how to activate and use the card, or you can learn more at www.eipcard.com. IRS Get My Payment portal for federal return filers: https://www.irs.gov/coronavirus/get-my-payment IRS Non-Filers Enter Payment Info Here Portal: https://www.irs.gov/coro/non-filers-enter-payment-info-here