Tax Changes for Tax Year 2016, Tax Season 2017
- Tax Brackets have creeped up by .4%, so we will be paying more taxes in 2016.
- The Federal Tax Day deadline for filing 2016 Form 1040 is Tuesday, April 18th, 2017.
- Penalties have increased for individuals not having qualified health insurance in 2016.
- March 15th, 2017 is the “new-earlier” due date for Form 1065, for LLC’s and Partnerships.
Free-Filing is good, so try it - but know what you are getting
As always, we recommend that Taxpayers with relatively simple or straight forward income taxes, consider taking advantage of the many free or low cost electronic filing services offered by the IRS, the States, and many tax software vendors [check-out sites like - www.irs.gov - www.freefile.irs.gov - www. turbotax.intuit.com - and www.taxact.com].
We caution –
# Be certain that you know whether: R Both the federal and state returns are being prepared for free, and R Electronic filing of both federal and state returns is free [in some places the federal is free and the state has a fee].
# Inquire about any service that asks to take the fees from your refund, especially if there is a charge for accepting or processing such payments. If you are inclined to have your refund put on a debit card, research the fees for having and using such cards, before you agree.
IRS and States are trying to make tax preparers their tax auditors
Tax Preparers are now required to see, ask for, or verify specific documentation before filing your tax returns, and are now exposed to penalties and loss of license, if it is determined that proper due diligence was not conducted.
If the Tax Preparer deducts an amount, without full due diligence, not only are you, the Taxpayer exposed to disallowance of the deduction, but the Tax Preparer is exposed to sanctions for lack of due diligence.
This may create situations where the Tax Preparer and the Taxpayer have to “agree to disagree”. We will always explain the advantages, benefits, draw-backs and exposure of any tax position we recommend.
Registered Tax Return Preparer
Former IRS Agent and Mid-Level Manager