1.6 million Americans are about to get an average $750 back from the IRS — could you be one of them?
If you filed your 2019 or 2020 taxes late, then you’re likely eligible for a rebate on those late fees. More than a million Americans will get a rebate from the Internal Revenue Service (IRS) or have their late fine canceled.
The relief applies to the failure to file penalty, which can be hefty. The penalty grows at about 5% per month up to 25% of the taxes that are unpaid when you finally do file. The IRS says “most people and businesses” who filed “certain” returns late will be eligible.
Mitt Romney says a billionaire tax will trigger demand for these two physical assets
You could be the landlord of Walmart, Whole Foods and Kroger
Do you fall in America’s lower, middle, or upper class? How your income stacks up
This investing app turns spare change into a diversified portfolio
That means 1.6 million people could soon receive an average refund of $750, which will add up to more than $1.2 billion. But if you’re one of the 1.6 million, you’ll have to file your overdue taxes by the end of the month or you could miss out.
Many people missed the deadline
Let’s be honest, deadlines were hard to meet during pandemic lockdowns for a lot of reasons.
“This will help a lot of taxpayers that couldn’t meet with their accountants, couldn’t file their taxes on time,” says Eileen Sherr, director for tax policy and advocacy with the American Institute of Certified Public Accountants (AICPA).
The relief applies to the 1040 and 1120 form series, which deal with income and corporate taxes. And Sherr says the move on the IRS’s part was necessary.
“We’ve been asking for it for years now, since the beginning of the pandemic,” she says.
Sherr points out that a larger than average number of people failed to meet the filing deadlines during the pandemic because of business closures and administrative backlogs.
“Sometimes it was just like a day or two late, a week or two late, but there were penalties that were assessed,” Sherr says.
But because the IRS only announced the relief in August, the AICPA worries many people might not be able to meet the deadline. To that end, the organization sent a letter to the IRS requesting that the deadline extension for getting the 2019 and 2020 taxes be extended beyond Sept. 30 to the end of the year.
“Especially if you have taxpayers who are abroad, and they’re trying to file and get all their returns — it’s really hard to get everything in time to meet this short deadline,” says Sherr. “It would just give more time for more people to voluntarily comply, if they haven’t, and for all the penalty issues to be resolved.”
How to make sure you get it
If you haven’t filed your 2019 or 2020 taxes yet, then you’ll need to do so by Sept. 30 to be eligible for relief.
But if you’ve already filed and paid a penalty, then you shouldn’t have to do anything to get your refund. That being said, if you’re expecting a refund, Sherr suggests checking your account on the IRS website.
However, keep in mind that it may take a few weeks for the refund to be processed. And the forgiveness only applies if you filed late, not if you paid late.
“[The] IRS said they were going to try to get the adjustment by the end of October … It could take a month or two. But I would say by the end of October, that account should be adjusted.”
If you don’t see something by then, Sherr suggests contacting the IRS.
And if you get a notice warning that you filed late and will need to pay a late penalty but believe you’re eligible for this exemption, then you should contact the IRS, says Sherr.
“You can just respond back that the notice applies and it should be abated.”
What to read next
High prices, rising interest rates and a volatile stock market — here’s why you need a financial advisor as a recession looms
If you owe $25K+ in student loans, there are ways to pay them off faster
With interest rates rising, now might be the time to finally tap into your home equity for cash
This article provides information only and should not be construed as advice. It is provided without warranty of any kind.
The Wall Street Journal
It is the worst year for buying the stock-market dip since the 1930s. Instead of rebounding after a tumble, stocks have continued to fall, denting a strategy that soared in popularity over the past decade.
When you put 20% down on the purchase of a home, you don’t have to borrow as much money as someone whose down payment is only 5% or 10%. And as a result, your monthly mortgage payment may be considerably … Continue reading -> The post This One Chart Shows Why Putting 20% Down on a Mortgage May Be a Mistake appeared first on SmartAsset Blog.
(Bloomberg) — Week by week, the bond-market crash just keeps getting worse and there’s no clear end in sight.Most Read from BloombergBank of England Says Paper Banknotes Only Good for One More WeekThe Great Bond Bubble Is ‘Poof, Gone’ in Worst Year Since 1949’Read Putin More Often and Carefully,’ Lavrov Tells the WorldUK Market Plunge Sparks Talk of Emergency BOE Rate HikeWith central banks worldwide aggressively ratcheting up interest rates in the face of stubbornly high inflation, prices are
Estate planning goes beyond drafting a will. Use this pre-death checklist to account for your assets and ensure they are dispersed as you wish,
Yes, there’s a lot of economic concerns, but this is a buying opportunity (and things aren’t nearly as bad as they seem).
The S&P 500 could retest its June low in the week ahead as equity markets endure a brutal bout of selling spurred by fears the Federal Reserve’s inflation fight may cause a recession.
Liz Truss’s ?45bn tax cutting spree has set Britain on course for a bailout from the International Monetary Fund, a leading economist dubbed Dr Doom has warned, as fears grow that the pound could fall to parity with the dollar.
The financial services giant is tweaking its digital-advice platform in an effort to win over more young and first-time investors.
There are no reasons to be thankful for high inflation. However, unexpected — but not necessarily unfortunate — consequences of this year’s persistently high inflation rate will be…
(Bloomberg) — John Paulson became a billionaire after his hedge fund effectively shorted more than $25 billion of mortgage securities at the dawn of the global financial crisis. Most Read from BloombergBank of England Says Paper Banknotes Only Good for One More WeekThe Great Bond Bubble Is ‘Poof, Gone’ in Worst Year Since 1949’Read Putin More Often and Carefully,’ Lavrov Tells the WorldUK Market Plunge Sparks Talk of Emergency BOE Rate HikeAs he sizes up yet another frothy housing market some 1
While Social Security is a “safety net” for some in retirement who have additional funds, for others it is all the income they have to live on. Depending on where you live, however, it may not go very…
(Bloomberg) — Al Gore, the former US vice president turned climate activist, said investors are growing increasingly impatient with evidence of potential “greenwashing” amid signs that net-zero pledges made by some members of the financial industry weren’t credible.Most Read from BloombergBank of England Says Paper Banknotes Only Good for One More WeekThe Great Bond Bubble Is ‘Poof, Gone’ in Worst Year Since 1949’Read Putin More Often and Carefully,’ Lavrov Tells the WorldUK Market Plunge Spark
Tesla’s billionaire CEO has a chance to expand his influence, but he can also give his critics new ammunition.