Tax-law changes will delay filing for some taxpayers
BY PHIL MULKINS World Action Line Editor
Wednesday, January 16, 2013
1/16/13 at 3:34 AM
Following this month's tax-law changes by Congress in the American Taxpayer Relief Act, the Internal Revenue Service announced Jan. 8 that it "plans to open the 2013 filing season and begin processing individual income tax returns Jan. 30 - after updating forms and completing programming and testing processing systems," IRS acting commissioner Steven T. Miller said. "This will reflect the bulk of the late tax-law changes Jan. 2. This means 120 million households should file tax returns starting Jan. 30."
The agency said other households can start filing in late February and into March as "the need for more extensive forms and processing systems change. It includes filers claiming residential energy credits, property depreciation or general business credits - a group that usually files complex tax returns closer to April 15 or seeks extensions."
"The IRS will not process paper tax returns before Jan. 30," the agency said. "There is no advantage to filing paper earlier. Filers receive refunds much faster by e-filing and direct-deposit."
The opening of the filing season follows the Jan. 1 passage by Congress of an extensive set of tax changes, with many affecting 2012 tax returns.
"While the IRS worked to anticipate the late tax-law changes as much as possible, the final law required the agency update forms and instructions as well as make critical processing system adjustments before it can begin accepting tax returns," Miller said.
The agency originally planned to open electronic filing Jan. 22; 80 percent of taxpayers filed electronically last year.
The National Association of Enrolled Agents, representing the interests of 47,000 professional income tax return preparers, issued a newsletter to its membership Friday outlining the things that members should keep in mind about the filing commencement push-back.
"You may not file returns electronically prior to Jan. 30, with the expectation IRS will hold the returns and process them on the 30th," it said. "Stockpiling rules are not in place, so you may meet with clients, prepare returns and hold them until Jan. 30 before transmission.
"Your clients need understand there is NO advantage to filing paper prior to Jan. 30 as IRS will not process paper returns until the 30th. Those mailed to the Service before then will sit in a pile awaiting manual processing. If a preparer submits a return with one of the 30 forms that are delayed, IRS will reject it and the Service will not hold them.
"Many of the individual tax return forms and schedules are still in draft form. In conversations with IRS, we've learned the final versions of forms the agency will accept at the start of the filing season will be available no later than Jan. 22. We expect IRS to announce a single date on which all 30 of the delayed forms will be accepted rather than announcing individual dates for each form."
Preparers ready to start most tax returns
"Despite the new filing date, Jackson Hewitt Tax Service urges taxpayers to start preparing their tax returns now. As 18 million file in January," the company said in an emailed release Jan. 9.
"Despite the new filing date, taxpayers can - and should - start having their tax returns prepared. The tax service has thousands of locations open around the country to answer taxpayers questions and prepare their returns," said Philip H. Sanford, Jackson Hewitt president and CEO.
"Although unfortunate and burdensome for millions of taxpayers, this IRS delay does not impact our readiness or our ability to work with clients," he said. "The delay, which is one of many complexities resulting from the recent fiscal cliff negotiations, points to how this year is even more challenging than years past. Now is the time to work with an experienced tax preparer to deal with many changes and ensure making the most of those changes."
TaxACT President JoAnn Kintzel said: "Although the IRS will start processing tax returns eight days later than usual this year, taxpayers can still prepare and e-file tax returns now with TaxACT. Most forms early filers need have been released by IRS and the majority of taxpayers can prepare and e-file returns regardless of IRS delays."
"Our programs have the latest tax law changes and tax forms, and our e-file process is open," she said. "Get it done now and be first in line when the IRS begins accepting returns from TaxACT and other providers Jan. 30. If a return includes a form not yet available, TaxACT's notification process automatically alerts customers of updates, allowing users to finish and e-file immediately."
Original Print Headline: Changes to tax laws may delay filing
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Associated Images:
The Ohio Clock on Capitol Hill in Washington strikes midnight on Jan. 1 as the Senate continues to work on the fiscal cliff. The Internal Revenue Service says late changes to federal tax laws should mean only a short delay for most taxpayers to file their 2012 returns. The agency said Tuesday that more than 120 million taxpayers — about 80 percent of all filers — should be able to start filing their federal returns on Jan. 30. Others will have to wait until late February or March to file because the agency needs time to update systems. Associated Press file
A sign identifies the Internal Revenue Service building in Washington, D.C. The IRS will open electronic filing Jan. 30. Bloomberg file
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