It’s Monday, Jan. 27, and the computers at the Internal Revenue Service will begin to gulp in 2019 returns from individual taxpayers today. They’ll be processing a deluge of numbers. The IRS expects to collect 150 million returns just from individuals this season.
Nonetheless, the earliest filers won’t be the bulk of those returns. Many of us still are waiting for necessary records – such as W-2 and 1099 forms from employers – to land in our mailboxes before filing. For example, Friday (Jan. 31) is the IRS’s deadline for employers to send out those pay reports to workers. In practice, that means they could arrive early in February.
The other end of the tax filing season – the due date for tax returns and payments – is standard April 15 this year. It’s been a day or two later in some recent years due to quirks in the calendar and a local holiday in the nation’s capital.
If it’s any help, let us note that 2020 is a leap year, and the leap day, Feb. 29, falls deep in tax filing season. So, we all are getting one more day than usual to prepare and pay up, thanks to the calendar.
What will be new when taxpayers and their preparers start figuring? They’ll encounter a redesigned Form 1040, for one change. It’s built to be simpler.
Many taxpayers who work for companies also might want to adjust their withholding rates after seeing their tax bills. There’s a new W-4 “Employee’s Withholding Certificate” that reflects changes made in the big revision of the tax code late in 2017. (Making a change is not required just because of the redesign, though, the IRS says.)
We’ll talk about the new 1040 and W-4 in future posts. But, for now, Eric Buechler, owner of EricJohn Ltd. and an enrolled agent recognized by the IRS, says paying attention to the 2020 W-4 can be important. He compared withholdings from a tax return using a 2019 W-4 with the same return using the newest W-4 for 2020. Sure enough, “Withholdings were different,” he says.
The IRS is offering a new tax withholding estimator at its Web site. (See https://www.irs.gov/individuals/tax-withholding-estimator ) Eric says his clients also can stop in for a personal tax projection.
Actually, if you work with any tax preparer on your return, it’s a good idea to reserve some time soon. Get on his/her work list. For example, Eric already is setting up schedules for interviews for preparing federal and state tax returns.
Welcome to a new tax filing season!