Podcast Summary
Anticipating Smaller Refunds: Uncertainty over Pandemic Payments and Deductions: Seek professional help for pandemic payment reporting, review deductions carefully, and maximize child tax credit benefits to ensure best possible tax outcome.
Many taxpayers are expecting smaller refunds this year due to confusion over pandemic payments and other changes. According to a consumer survey conducted by Forbes Advisor, 50% of taxpayers anticipate smaller refunds. The survey found that this was largely due to the fact that people were unsure about how to report the various pandemic payments they received in 2021. Kimberly Washington, a CPA and tax analyst, advises taxpayers to seek professional help if they are unsure about how to report these payments on their tax returns. In addition, Washington suggests that taxpayers review their deductions carefully to ensure they are taking advantage of all possible savings. For those with children, the child tax credit may also impact their tax filings this year, and Washington offers advice on how to maximize this benefit. Overall, the key takeaway is that taxpayers should be proactive in understanding the changes to the tax code this year and seek professional help if needed to ensure they are getting the best possible outcome. And, if you're hosting a brunch this tax season, consider visiting Whole Foods Market for wallet-friendly finds like whole smoked Atlantic salmon, mini quiches, and organic everything bagels to make your brunch celebratory and delicious.
Uncertainty Surrounds This Year's Tax Refunds: Despite concerns, most people should expect similar refunds as last year. Create an IRS account to ensure child tax credit accuracy and report last year's amount on tax return.
Many people are feeling anxious and uncertain about their tax refunds this year due to the impact of stimulus and child tax credit payments. The average refund is reportedly around $3,000, but people are worried that they will receive less than last year. However, once they file their tax returns, most people should expect to receive a refund similar to last year. The child tax credit is another source of confusion, with parents concerned about how to calculate their taxes. The first step is to create an online account with the IRS to ensure accuracy of the child tax credit payments received in 2021. Report the amount received last year on your tax return and determine if you qualify for additional money based on the child tax credit. Remember, this is general guidance and individual tax situations may vary. Overall, while there is understandable anxiety and confusion surrounding this tax season, most people should expect to receive a refund similar to last year.
Access IRS online account for tax benefits: Setting up an IRS online account can grant access to child tax credit info, potential recovery rebate tax credit, and helpful resources like 'Where's My Refund?'
Setting up an online account with the IRS can provide valuable information and potential benefits, including access to the child tax credit and the recovery rebate tax credit. The child tax credit not only includes payments received last year but also amounts that can be claimed when filing tax returns. The recovery rebate tax credit, which can provide up to $1,400 per person, is available to those who did not receive the third round stimulus payment last year. Additionally, free resources like the IRS's online account and "Where's My Refund?" tool can help answer common questions and reduce the need for direct contact with the IRS. If contact is necessary, be patient and try calling early in the morning.
Track your tax refund with IRS app, take advantage of deductions, and file early to avoid fraud: Use the IRS app to monitor refund status, maximize deductions like charitable donations and IRA contributions, and file taxes early to beat scammers and identity thieves
There are several ways to stay informed about your tax refund and potentially reduce your tax liability. One way is to download the IRS app, IRS to go, to track your refund. Another way is to take advantage of deductions, such as charitable donations up to $300 for singles or $600 for married couples, even if you don't itemize. You also have until April 18th to contribute to an IRA to lower your tax liability. Education expenses for dependents can also be deducted. With the increase in tax-related fraud, it's important to file your tax return early to avoid scammers filing before you. If you suspect identity theft, contact the IRS through their website. Additionally, consider requesting a PIN from the IRS to add an extra layer of security when filing your tax return. Be cautious when getting your taxes prepared to avoid falling victim to fraud.
Protect yourself from tax scams and ensure a smooth filing process: Go to a reputable tax professional, use reliable resources like the IRS website, file taxes early, and consider listening to informative podcasts for decision-making insights.
During tax season, it's crucial to go to a reputable tax professional or use reliable resources like the IRS website for filing. If your annual income is under $73,000, you can even file for free. To protect yourself from scams and ensure a smooth filing process, it's recommended to file taxes early. Kimberly Washington, a CPA and tax expert, emphasized these points in a recent interview on NPR's LIFE KIT podcast. For those interested in understanding the psychology behind decision-making, consider listening to the Choiceology podcast from NPR sponsor Charles Schwab. And for in-depth journalistic storytelling, tune into the BBC or listen to NPR's Embedded podcast.
