ATLANTA — Tax season has officially begun and the Internal Revenue Service is now accepting your 2021 tax returns.
Dr. Shireda Howard, a federal tax attorney and certified public accountant (CPA) said there are a few things taxpayers should do to guarantee the quickest refund possible.
One of them is filing electronically, especially with the pandemic-related backlog at the IRS.
"I am urging all of my clients to file electronically, especially if I know right now I'm waiting for amendments six months and I still haven't heard back from anything. I am, I am definitely going to be a supporter of e-file and e-file early," said Dr. Howard.
The uptake in filing electronically does come with some concern, according to Dr. Howard.
"Well, unfortunately, we are in for lack of better terminology, a scammer situation," she said.
She urges taxpayers to always check back with the IRS website if they receive emails that have their logo and branding. The IRS also warns people on their website of possible scammers who reach out via email, text, and even social media by letting them that's it's not them.
'The IRS doesn't initiate contact with taxpayers by email, text messages or social media channels to request personal or financial information
Here are some important topics to brush up on:
Child Tax Credit
This tax-filing season requires that people report the advanced child tax and the third stimulus check that was received in March when filing taxes.
Taxpayers should also report their unemployment if they received it on their 2021 taxes as income.
Important tax forms
Dr. Howard advises that taxpayers wait until they receive their Letter 6419 and Letter 6475 in the mail before filing.
Letter 6419 is being sent to anyone that received an advanced child tax credit payment in 2021. The form shows all the payments that have been paid out to the taxpayer.
Letter 6475 is being sent to people who received a third stimulus check in 2021. It will help taxpayers determine whether they are eligible to claim the recovery rebate credit (RRC) for any missing stimulus payment.
People who are eligible for the recovery rebate credit must file a 2021 federal income tax return to claim their remaining stimulus payment.
Reporting the correct amount for both the advanced child tax and third stimulus check is very important, said Dr. Howard.
"What I've been advising is for individuals to go back, look at their actual bank statements where those funds were deposited in, a lot of individuals receive those particular funds electronically," she said.
According to Dr. Howard, some families who received the advanced child tax credit have already received their Letter 6419.
Form 1099-K
Form 1099-K or Payment Card and Third-Party Network Transactions must be filed by anyone that has received payments that exceed $600 using a third-party payment network.
These third-party payment networks include Venmo, PayPal and Cash App.
You must report this income only if it's commercial income collected through these apps and not personal transactions.
An example of commercial income that must be reported via these apps would include people who sell items on internet auction sites like eBay or have a shop online where they sell items.
The deadline this year for getting your tax returns to the IRS is Monday, April 18.
In the midst of a stressful tax season, Dr. Howard believes it's important to take a breather.
"The only thing that I want to advise is, you know, take a breather. Take your time and just be prepared. I know taxes is one of those things that's normally seen as being very stressful, but with everything else, that's going on. Just take your time, take a breather and you'll get through it," said Dr. Howard.