Surprise! Will you be one of the taxpayers who gets this unwelcome one: You owe money to the IRS!
To ensure this doesn’t happen to you, take note of these 5 myths…
Myth #1: Getting a refund this year means there’s no need to adjust withholding for 2021!
There are many variables that affect how much you owe in taxes from year to year. These include life events like marriage, divorce, birth of a child or an adoption. In addition, if you are no longer able to claim a person as a dependent, your taxes are impacted.
So, how can you best prepare for next year?
You can adjust your tax withholding with your employer — but, first use the Tax Withholding Estimator. This easy-to-use tool helps taxpayers determine if their employer is withholding the correct amount. Those who have gotten an unexpected result after filing their tax return this year should be on high alert to take this precaution now.
Are you eager for details about your refund? Here are some common myths that can mislead you.
Myth #2: Calling the IRS or a tax professional will provide a better refund date.
Many people think that speaking to the IRS or their tax professional is the best way to find out when they will get their refund. It’s not. The best way to check the status of a refund is online through the Where’s My Refund? tool or the IRS2Go app.
Taxpayers can also call the automated refund hotline at 800-829-1954. This hotline has the same information as Where’s My Refund? and IRS telephone assistors. There’s no need to call the IRS unless Where’s My Refund? says to do so.
Myth #3: Ordering a tax transcript is a secret way to get a refund date.
Doing so will not help you find out when you will get their refund. Where’s My Refund? tells taxpayers their tax return has been received and if the IRS has approved or sent the refund.
Myth #4: Where’s My Refund? must be wrong because there’s no deposit date yet.
Updates to Where’s My Refund? on both IRS.gov and the IRS2Go mobile app are made once a day. These updates usually occur overnight. Even though the IRS issues most refunds in less than 21 days, it’s possible a refund may take longer. If the IRS needs more information to process your tax return, the agency will contact you by mail. You should also consider the time it takes for the banks to post the refund to your account. If you’re waiting for a refund in the mail, consider the time it takes for a check to arrive.
The press has announced that the IRS is so far behind this year that it could take months for them to catch up. So be prepared for a significant delay — and be very pleased if it comes sooner!
Myth #5: Where’s My Refund? must be wrong because the refund amount is less than expected.
There are several factors that could result in larger or smaller tax refunds than you expect. These include:
- You made math errors or mistakes
- You owe federal taxes for a prior year
- You owe state taxes, child support, student loans or other delinquent federal non-tax obligations
- The IRS holds a portion of the refund while it reviews an item claimed on the return
If these adjustments are made, the IRS will mail you a letter of explanation. You may also receive a letter from the Department of Treasury’s Bureau of the Fiscal Service if your refund was reduced because of certain financial obligations.
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