Here are important IRS updates from the end of June.
IRS News Updates
Beat the Rush On ITIN Renewal
Over 2 million ITINs (Individual Taxpayer Identification Numbers) are set to expire at the end of this year. The IRS urges those affected to submit their application for renewal to avoid delays in the processing of next year’s tax refunds. To renew, applicants must fill out form W-7 and proper documentation. More information is available here.
Hurricane-Affected Taxpayer Due Date June 29
Residents of Puerto Rico, US Virgin Islands and American Samoa who were affected by last year’s hurricanes and tropical storms were given a tax return filing extension. No interest or penalties will be due if returns are filed by June 29. Those who permanently relocated to the US mainland may need to file form 8898. Click here for details.
Check Your Withholding
The IRS encourages taxpayers who owed taxes this year to review their paycheck withholding to ensure they won’t be surprised by a large tax bill next year. The Tax Cuts and Jobs Act passed in December 2017 made major changes to tax law but using the IRS’ Withholding Calculator can help you stay on track and avoid penalties, incurred if any underpayment exceeds $1000 this year.
Simpler 1040 Form
The IRS is working on a new, streamlined 1040 to simplify tax filing for some taxpayers beginning in the 2019 tax season. Additional schedules still apply. The IRS is also working with tax preparers and tax software companies to ensure a smooth transition for those using these services.
Reports Issued to Congress
Electronic Tax Administration Advisory Committee (ETAAC) released its annual report on June 27, featuring numerous recommendations on a range of issues in electronic tax administration. Their focus is on refund fraud and cybersecurity, and their goal is that 80% of returns should be done electronically.
The National Taxpayer Advocate released the mid-year report presenting a review of the 2018 tax season and priority issues to be addressed in the upcoming year. Implementation of the Tax Cuts and Jobs Act and improving customer service are the primary goals, given the IRS’ poor marks in customer service and the President’s Management Agenda’s emphasis on the importance of high-quality customer service. It says: “Federal customers . . . deserve a customer experience that compares to – or exceeds – that of leading private sector organizations.” More information and details are available here.