New IRS Updates
IRS.gov feature helps people who normally don’t file get payments; second tool next week provides taxpayers with payment delivery date and provide direct deposit information
WASHINGTON – To help millions of people, the Treasury Department and the Internal Revenue Service today launched a new web tool allowing quick registration for Economic Impact Payments for those who don’t normally file a tax return.
The non-filer tool, developed in partnership between the IRS and the Free File Alliance, provides a free and easy option designed for people who don’t have a return filing obligation, including those with too little income to file. The feature is available only on IRS.gov, and users should look for Non-filers: Enter Payment Info Here to take them directly to the tool.
“People who don’t have a return filing obligation can use this tool to give us basic information so they can receive their Economic Impact Payments as soon as possible,” said IRS Commissioner Chuck Rettig. “The IRS and Free File Alliance have been working around the clock to deliver this new tool to help people.”
The IRS reminds taxpayers that Economic Impact Payments will be distributed automatically to most people starting next week. Eligible taxpayers who filed tax returns for 2019 or 2018 will receive the payments automatically. Automatic payments will also go in the near future to those receiving Social Security retirement or disability benefits and Railroad Retirement benefits.
How do I use the Non-Filers: Enter Payment Info tool?
For those who don’t normally file a tax return, the process is simple and only takes a few minutes to complete. First, visit IRS.gov, and look for “Non-Filers: Enter Payment Info Here.” Then provide basic information including Social Security number, name, address, and dependents. The IRS will use this information to confirm eligibility and calculate and send an Economic Impact Payment. Using the tool to get your payment will not result in any taxes being owed. Entering bank or financial account information will allow the IRS to deposit your payment directly in your account. Otherwise, your payment will be mailed to you.
“Non-Filers: Enter Payment Info” is secure, and the information entered will be safe. The tool is based on Free File Fillable Forms, part of the Free File Alliance’s offerings of free products on IRS.gov.
Who should use the Non-Filers tool?
This new tool is designed for people who did not file a tax return for 2018 or 2019 and who don’t receive Social Security retirement or disability benefits or Railroad Retirement benefits. Others who should consider the Non-Filers tool as an option, include:
Lower income: Among those who could use Non-Filers: Enter Payment Info tool are those who haven’t filed a 2018 or 2019 return because they are under the normal income limits for filing a tax return. This may include single filers who made under $12,200 and married couples making less than $24,400 in 2019.
Veterans beneficiaries and Supplemental Security Income (SSI) recipients: The IRS continues to explore ways to see if Economic Impact Payments can be made automatically to SSI recipients and those who receive veterans disability compensation, pension or survivor benefits from the Department of Veterans Affairs and who did not file a tax return for the 2018 or 2019 tax years. People in these groups can either use Non-Filers: Enter Payment Info option now or wait as the IRS continues to review automatic payment options to simplify delivery for these groups.
Social Security, SSDI and Railroad Retirement beneficiaries with qualifying dependents: These groups will automatically receive $1,200 Economic Impact Payments. People in this group who have qualifying children under age 17 may use Non-Filers: Enter Payment Info to claim the $500 payment per child.
Students and others: If someone else claimed you on their tax return, you will not be eligible for the Economic Impact Payment or using the Non-Filer tool.
Coming next week: Automatic payments begin
Eligible taxpayers who filed tax returns for either 2019 or 2018 and chose direct deposit of their refund will automatically receive an Economic Impact Payment of up to $1,200 for individuals or $2,400 for married couples and $500 for each qualifying child. Individuals who receive Social Security retirement or disability benefits, SSDI or who receive Railroad Retirement benefits but did not file a return for 2019 or 2018 will automatically receive a payment in the near future.
Coming next week: Get My Payment shows Economic Impact Payment date, helps with direct deposit
To help everyone check on the status of their payments, the IRS is building a second new tool expected to be available for use by April 17. Get My Payment will provide people with the status of their payment, including the date their payment is scheduled to be deposited into their bank account or mailed to them.
An additional feature on Get My Payment will allow eligible people a chance to provide their bank account information so they can receive their payment more quickly rather than waiting for a paper check. This feature will be unavailable if the Economic Impact Payment has already been scheduled for delivery.
EIDL loan info
Wanted to give all ya'll small business owners, that have applied for the EIDL loans, a bit of information.
Deni actually called today, in query to her own loan, to check on the progress. Let's just say when she called she was # 1,598 in que and it took almost an hour to get to her. If you don't have to call, it is for the best.
Anyway, the only information that can be given at this time (when you call) is that your loan has been received. The folks in the call center cannot see any progress/processing information. Once the application has been processed, an EMAIL (from the .gov site) will be sent out to verify if the loan/grant is still wanted. You must then put in your answer & from there it will continue on the process. She was able to verify that the loan does look at your credit score for part of the approval process. The gal was not able to verify how long this next process is or what type of question(s) are asked. She also was not able to say what other type of info would be given as far as if you are denied and the up to $10K advance. She was able to verify that if anyone does call you in regards to the loan (not likely but entirely possible) that the only way you should give them any info is if they repeat your loan application # to you. This is the confirmation # that you printed/saved once the application was complete.
I know this isn't a lot of information but it is a little something. The take away is, if you call, they won't be able to give you any information so it is best not to waste the hours on hold.
more Stimulus info....
March 30, 2020
Issue Number: IR-2020-61
WASHINGTON – The Treasury Department and the Internal Revenue Service today announced that distribution of economic impact payments will begin in the next three weeks and will be distributed automatically, with no action required for most people. However, some seniors and others who typically do not file returns will need to submit a simple tax return to receive the stimulus payment.
Who is eligible for the economic impact payment?
Tax filers with adjusted gross income up to $75,000 for individuals and up to $150,000 for married couples filing joint returns will receive the full payment. For filers with income above those amounts, the payment amount is reduced by $5 for each $100 above the $75,000/$150,000 thresholds. Single filers with income exceeding $99,000 and $198,000 for joint filers with no children are not eligible.
Eligible taxpayers who filed tax returns for either 2019 or 2018 will automatically receive an economic impact payment of up to $1,200 for individuals or $2,400 for married couples. Parents also receive $500 for each qualifying child.
How will the IRS know where to send my payment?
The vast majority of people do not need to take any action. The IRS will calculate and automatically send the economic impact payment to those eligible.
For people who have already filed their 2019 tax returns, the IRS will use this information to calculate the payment amount. For those who have not yet filed their return for 2019, the IRS will use information from their 2018 tax filing to calculate the payment. The economic impact payment will be deposited directly into the same banking account reflected on the return filed.
The IRS does not have my direct deposit information. What can I do?
In the coming weeks, Treasury plans to develop a web-based portal for individuals to provide their banking information to the IRS online, so that individuals can receive payments immediately as opposed to checks in the mail.
I am not typically required to file a tax return. Can I still receive my payment?
Yes. People who typically do not file a tax return will need to file a simple tax return to receive an economic impact payment. Low-income taxpayers, senior citizens, Social Security recipients, some veterans and individuals with disabilities who are otherwise not required to file a tax return will not owe tax.
How can I file the tax return needed to receive my economic impact payment?
IRS.gov/coronavirus will soon provide information instructing people in these groups on how to file a 2019 tax return with simple, but necessary, information including their filing status, number of dependents and direct deposit bank account information.
I have not filed my tax return for 2018 or 2019. Can I still receive an economic impact payment?
Yes. The IRS urges anyone with a tax filing obligation who has not yet filed a tax return for 2018 or 2019 to file as soon as they can to receive an economic impact payment. Taxpayers should include direct deposit banking information on the return.
I need to file a tax return. How long are the economic impact payments available?
For those concerned about visiting a tax professional or local community organization in person to get help with a tax return, these economic impact payments will be available throughout the rest of 2020.
Where can I get more information?
The IRS will post all key information on IRS.gov/coronavirus as soon as it becomes available.
The IRS has a reduced staff in many of its offices but remains committed to helping eligible individuals receive their payments expeditiously. Check for updated information on IRS.gov/coronavirus rather than calling IRS assistors who are helping process 2019 returns.
Small business Disaster Loan
On March 27, 2020, President Trump signed into law the CARES Act, which provided additional assistance for small business owners and non-profits, including the opportunity to get up to a $10,000 Advance on an Economic Injury Disaster Loan (EIDL). This Advance may be available even if your EIDL application was declined or is still pending, and will be forgiven.
If you wish to apply for the Advance on your EIDL, please visit www.SBA.gov/Disaster as soon as possible to fill out a new, streamlined application. In order to qualify for the Advance, you need to submit this new application even if you previously submitted an EIDL application. Applying for the Advance will not impact the status or slow your existing application.
Beware of Stimulus Payment scams
Victims or targets of stimulus payment scams should report it immediately to the Federal Trade Commission, www.ftc.gov/complaint.
We will provide more information about the IRS’s plans to process stimulus payments as it becomes available.
Tax Return Info
COVID-19 - Tax Return Filing & Payment Relief
Does the deadline postponement apply to return filing and payments?
Yes. Both the filing and payment deadlines have been automatically postponed from April 15, 2020 to July 15, 2020 for individuals, trusts, estates, corporations, or any type of unincorporated business entity. Interest and penalties will begin to accrue after July 15.
Do taxpayers need to file any additional forms to qualify for relief?
No, taxpayers do not need to submit any additional forms; the new July 15, 2020 deadline applies to all taxpayers with a Federal income tax return or payment formerly due on April 15, 2020. Individual taxpayers, who need additional time to file beyond July 15, can request a filing extension until October 15 by filing Form 4868 before the July 15 due date. Corporate filers use Form 7004 to request additional time.
Has the filing deadline for all state returns been postponed to July 15?
State filing and payment deadlines vary by state. Check with each state to get an accurate due date for filing and payment or visit our State Response to Covid-19 page.
I have already filed returns with a scheduled payment date of April 15, 2020. Will this payment be automatically rescheduled for July 15, 2020?
No, the payment will not automatically reschedule. The payment will be made on the date selected unless the payment is rescheduled. Follow the instructions below to reschedule or cancel a payment.
No, the April 15 estimated tax payment due date is also postponed until July 15, 2020.
Have the second quarter 2020 estimated tax payments, due on June 15, 2020, also been postponed?
No, the postponement only applies to the April 15, 2020 payment. The June 15, 2020 estimated payment due date remains the same.
Does this relief provide more time to contribute money to an IRA, HSA, or Archer MSA for 2019?
Yes. Contributions may be made for a particular year, at any time during the year or by the due date for filing a return for that year. Because the due date for filing Federal income tax returns has been postponed to July 15, the deadline for making contributions to IRA, HSA, or Archer MSA for 2019 is also extended to July 15, 2020.
I have tried calling the IRS for help, but I have been unable to reach anyone by telephone. What should I do?
Limited live telephone customer service assistance is currently available due to precautions taken to protect IRS employees from the coronavirus. High demand has created very lengthy wait times. The IRS encourages people to use IRS.gov for information.
How can I keep up with the IRS response to the Coronavirus and COVID-19 legislation?
For the most up-to-date information, visit the IRS Coronavirus page https://www.irs.gov/coronavirus. As information is released regarding stimulus payments and legislation, it will be posted to this page. More FAQs can be found at https://www.irs.gov/newsroom/filing-and-payment-deadlines-questions-and-answers.
Stimulus & Unemployment info
We have found some information regarding the Stimulus checks, Unemployment and the Coronavirus Bill. It may be a long read but it gives a lot of useful information.
F.A.Q. on Stimulus Checks, Unemployment and the Coronavirus Bill
The Senate relief bill would send money to Americans and greatly expand unemployment coverage.
By Tara Siegel Bernard and Ron Lieber
· March 26, 2020, 2:36 p.m. ET
The Senate unanimously passed a $2 trillion economic rescue plan on Wednesday that will offer assistance to tens of millions of American households affected by the coronavirus. Its components include stimulus payments to individuals, expanded unemployment coverage, student loan changes, different retirement account rules and more.
The House of Representatives was expected to quickly take up the bill and pass it, sending it to President Trump for his signature.
Here are the answers to common questions about what’s in the bill. We’ll update this article as we have more answers or if the plan changes as it moves through the legislative process.
How large would the payments be?
Most adults would get $1,200, although some would get less. For every child age 16 or under, the payment would be an additional $500.
How many payments would there be?
Just one. Future bills could order up additional payments, though.
How do I know if I will get the full amount?
It depends on your income. Single adults with Social Security numbers who have an adjusted gross income of $75,000 or less would get the full amount. Married couples with no children earning $150,000 or less would receive a total of $2,400. And someone filing as head of household will get the full payment if they earn $112,500 or less.
Above those income figures, the payment decreases until it stops altogether for single people earning $99,000 or married people earning $198,000.
In any given family and in most instances, everyone must have a valid Social Security number. There is an exception for members of the military.
You can find your adjusted gross income on line 8b of the 2019 1040 federal tax return.
What year’s income should I be looking at?
2019. If you haven’t prepared a tax return yet, you can use your 2018 return. If you haven’t filed that yet, you can use a 2019 Social Security statement showing your income.
What if my recent income made me ineligible, but I anticipate being eligible because of a loss of income in 2020? Do I get a payment?
The bill does not appear to help people in that circumstance, but there are many other provisions in the legislation. You may be able to file for unemployment or for one of the new loans for small business owners or sole proprietors.
Would I have to apply to receive a payment?
No. If the Internal Revenue Service already has your bank account information, it would transfer the money to you via direct deposit based on the recent income-tax figures it already has.
When would they arrive?
Treasury Secretary Steven Mnuchin said that he expected most people to get their payments within three weeks.
If my payment doesn’t come soon, how can I be sure that it wasn’t misdirected?
According to the bill, you would get a paper notice in the mail no later than a few weeks after your payment has been disbursed. That notice would contain information about where the payment ended up and in what form it was made. If you couldn’t locate the payment at that point, it would be time to contact the I.R.S. using the information on the notice.
What if I haven’t filed tax returns recently, would that affect my ability to receive a payment?
It could. File a return immediately, at least for 2018, according to the I.R.S. website. “Those without 2018 tax filings on record could potentially affect mailings of stimulus checks,” the site says.
If you’re worried about money that you owe that you cannot pay, the I.R.S. recommends consulting a tax professional who can help you request an alternative payment plan or some other resolution.
Would most people who are receiving Social Security retirement and disability payments each month also get a stimulus payment?
Would eligible unemployed people get these stimulus payments? Veterans?
Yes and yes.
If my income tax refunds are currently being garnished because of a student loan default, would this payment be garnished as well?
Who would be covered by the expanded program?
The new bill would wrap in far more workers than are usually eligible for unemployment benefits, including self-employed people and part-time workers. The bottom-line: Those who are unemployed, partially unemployed or who cannot work for a wide variety of coronavirus-related reasons would be more likely to receive benefits.
How much would I receive?
It depends on your state.
Benefits would be expanded in a bid to replace the average worker’s paycheck, explained Andrew Stettner, a senior fellow at the Century Foundation, a public policy research group. The average worker earns about $1,000 a week, and unemployment benefits often replace roughly 40 to 45 percent of that. The expansion would pay an extra amount to fill the gap.
Under the plan, eligible workers would get an extra $600 per week on top of their state benefit. But some states are more generous than others. According to the Century Foundation, the maximum weekly benefit in Alabama is $265, but it’s $450 in California and $681 in New Jersey.
So let’s say a worker was making $1,100 per week in New York; she’d be eligible for the maximum state unemployment benefit of $435 per week. Under the new program, she gets an additional $600 of federal pandemic unemployment compensation, for a total of $1,035, or nearly all of her original paycheck.
Dear Clients, Family and Friends:
Another exciting year has passed. Time to begin the gathering process for your upcoming tax needs. Before we get to this let us take a moment to introduce the Serenity family:
Deni Lorenzi – Boss Lady & Enrolled Agent – What is an Enrolled Agent? It means she gets the privilege to talk to the IRS whenever they call. She gets to have all the fun. Deni also continues to provide bookkeeping services and training for clients.
Sheri Murray - Office Manager – Sheri keeps the office running and handles a list of bookkeeping and payroll clients. She, as always, is available for questions. She is still our go-to girl to get things done.
Skye - Office Manager in Training - Skye is Sheri’s daughter and comes in occasionally to do random tasks around the office.
Dina Suwanski - Administrative Assistant - Dina is generally the one you will hear on the phone and is responsible for all aspects of tax return processing. Give her a call or email if you want your 2019 tax organizer. 218-464-1510 firstname.lastname@example.org
Dani Fahlsing- Staff Accountant/Tax Preparer. Dani is new to Serenity this year. She comes to us with over 20 years of accounting background. Many of our bookkeeping and payroll clients are already familiar with her and her talents. For our tax clients and others not familiar with Dani, she comes to us from Wisconsin and brings these tax laws into sharper focus. Dani is looking forward to expanding her client base with your tax needs!
John Ludwig, AFSP- John continues his tax geek ways. Along with his tax preparation, he has become our tax return checker. His research talent continues to be a driving force showing his abilities, if we don’t know something, we go to him! So, bring on all your tax questions, he is always looking for a challenge!
DJ (Diane Johnson) - DJ works part time and therefore primarily works with our drop off and mail-in returns. She has branched out and has started working on bookkeeping for some of our smaller clients.
As you can see, our staff is more streamlined this year. It is all designed to give you the client a better experience and most accurate service. You can visit our website at www.serenityduluth.com, which is always updated to better serve you! You can request a tax appointment or tax organizer on our website as well as see all the other services that we offer. Of course, you can always call us.
And now, some exciting news from the IRS and other Taxing authorities! Of course, taxing authorities cannot leave well enough alone. All of us at Serenity have been diligently training and absorbing their respective changes, all in the name of taking care of your most difficult and not so difficult tax needs. Below is a snapshot of what we have learned but is by far not all inclusive. If you have a question you feel is unique, please feel free to reach out to us personally!
Standard deduction. It is now indexed for inflation:
Dependent $1,100 (or earned income +$350)
Mileage rates: Business .58
Child Adoption Credit: max credit of $14,080
Phaseout Range increases to $211,160 to $251,160
Child credit: No changes from 2018, including other dependent credit (ODC)
CTC $2,000 ($1,400 is refundable)
EIC. Income levels changed for maximum credit and phaseout credit amounts
# children MFJ Non MFJ
Maximum Cr Phaseout range Maximum Cr Phaseout Range
0 $6.920-$14,450 $14,450-$21,370 $6,920-$8,650 $8,650-$15,570
1 $10,370-$24,820 $24,820-$46,884 $10,370-$19,030 $19,030-$41,094
2 $14,570-$24,820 $24,820-$52,483 $14,570-$19,030 $19,030-$46,703
3+ $14,570-$24,820 $24,820-$55,952 $14,570-$19,030 $19,030-$50,162
Retirement age: if you were born 1943 – 1954 retirement age is 66
If you were born 1960 or later retirement age is now 67
Foreign Income Exclusion: $105,900 maximum
401(k) contribution limits: $19,000 ($25,000 catchup for over 50)
IRA Contributions: $6,000/person ($7,000 catchup for over 50)
IRA Deduction Phaseouts:
AGI phaseout begins AGI fully phased out
Single $64,000 $74,000
MFJ/QW $103,000 $123,000
Spouse not covered by plan $193,000 $203,000
MFS $0 $10,000
HOH $64,000 $74,000
Premium Tax Credit (health insurance):
There is no penalty this year for not having health insurance. However, if you received subsidized health insurance through MN Care, you still need to reconcile this on you tax return. BE SURE TO BRING IN YOU 1095-A.
No personal exemption—still allows dependent exemption
Standard deduction increases to align with federal
Social Security subtraction increase:
MFJ/QW - $5,150
S/HOH - $4,020
MFS - $2,575
Every year it seems as if we have issues with this topic, so we thought it prudent to include. For those clients that have college students, and are claiming these students on their return, please caution your dependent (the student) to NOT claim themselves. If they do, you will not be able to claim the child (the student) and therefore the accompanying education credits that are more beneficial to you as a parent. The “after the fact” solution to this situation is to amend the dependent child’s (the student) return, and then paper file your return. Amendments are charged at $140 + any state(s) and refunds are delayed.
Everyone asks about pricing. Rest assured we at Serenity are aware of this and as a result your 2020 tax season will not see any significant price increases. However, as some Federal tax forms have been modified, added, or deleted, Federal pricing may change slightly. Minnesota tax forms have had some additions to Serenity reporting requirements and therefore a slight modification is needed. The form M1PR (Property tax rebate, renters rebate) will increase to $30 (this increase goes to $50 for those clients that ONLY file a M1PR with Serenity)
For those clients that have dependents (children) on their tax return and want Serenity to complete their returns (if applicable), Serenity will no longer charge a flat rate for these returns. Dependent returns will be priced at 50% of whatever the tax return would be priced at.
IRS e-file acceptance: January 27, 2020
Federal/State filing 2019 Filing deadline businesses: Monday March 16, 2020
Federal/State filing 2019 Filing deadline 1040: Wednesday, April 15, 2020
Non Profits (990): Friday May, 15, 2020
Estimated payments: Quarter 1 (Jan, Feb, Mar) April 15, 2020
Quarter 2 (Apr, May, Jun) June 15, 2020
Quarter 3 (Jul, Aug, Sept) September 15, 2020
Quarter 4 (Oct, Nov, Dec) January 15, 2021
Tax season office hours (starting 1/27/2020):
Monday thru Thursday 8:30 am to 8:00 pm
Friday and Saturday 8:30 am to 5:00 pm
First daily tax appointments will be scheduled for 9:00 am and the last appointment will be 1 hour before close. As always, drop off, US MAIL and email information submission is always accepted.
**** Due to changing IRS and due diligence requirements, tax clients will be asked to sign a form prior to tax preparation. If you are one of those clients that drop off and/or mail your tax documents, please be sure you get this form to sign to speed the completion process
One last item. We are here because of you. Your faith in us through your personal recommendation to others is humbling. As usual, for your personal recommendations to new tax clients, we discount your next year’s tax preparation by $15 as a thank you. Your loyalty, support, and friendship to the Serenity family is why we are here. We appreciate the opportunity to serve all your tax preparation needs and look forward to seeing you in the year 2020!
Deni, Sheri, Dina, Dani, John, DJ, Skye
New Minimum Wage - Eff 1/1/20
Beginning January 1, 2020, Minnesota will have an increase in the minimum wage.
* Large employers (gross revenues of $500K and more) must pay at least $10/hour
* Small employers (gross revenues less than $500K) must pay at least $8.15/hour
* The training wage, $8.15/hour, may be paid to employees younger than 20 years of age for the first 90 consecutive days of employment.
* The youth wage rate, $8.15/hour, may be paid to employees younger than 18 years of age.
Sales Tax Increase - eff 10/1/19
As of October 1, 2019, Duluth will have an increase in the City percentage of the sales tax rate. It will be increased from 1% to 1.5%.
Regular sales tax will increase from 8.375% to 8.875%
Restaurant (food) rate will increase from 10.625% to 11.125%
Restaurant (alcohol) rate will increase from 13.125% to 13.625%
If you use Square or any other mobile app that includes sales tax, remember to make adjustments to the settings.
Our professionals are here to serve you and offer advise on your tax and small business financial needs.