Now that tax season is over and we are starting to recover here, it can be worthwhile to look back on the time that was.

​The first thing to note is that this season largely represented a “return to normal” as there were no (any new ones, anyway) pandemic measures to find our way through that added to the regular questions concerning everyone’s tax returns and provided some surprise answers for some. It may take some time now for people to adjust to their new normal (for the lack of these pandemic measures offered different surprises for some) but there is a sense that answers feel clearer now anyway.

Not only did those pandemic measures affect everyone individually, they affected the IRS as a whole, as the agency was given the responsibility of getting out three rounds of stimulus payments while adjusting to the rest of the other new rules and changes instituted. In addition, this season was the agency’s first chance to really show off improved performance following recently receiving a 10-year, $80-billion increased funding package.

It is important to remember that much of that new funding is going toward enforcement, so it is not as if things should feel different to every individual taxpayer. In fact, one could plausibly argue that with the IRS receiving that money, people should instead just not have to think about the IRS and its work should happen smoothly without note.

Over this recent tax season, the IRS achieved an 87% level of service (and exactly how that is measured, well, we will leave that to the IRS super fans). Now, this doesn’t sound that spectacular to me, but it did at least surpass the 85% goal set by Treasure Secretary Janet Yellen. But even if those don’t sound like the loftiest of numbers, it does look MUCH better when compared against last year’s number of a 15% level of service to taxpayers – so yes, things really were that bad.

I think this comes with two big headlines. First, after a couple of years of backlogs when we had to tell some clients that we couldn’t give them any type of reasonable prediction as to when some filings would be processed, that has been worked through. Mailed forms will still take longer to process, but we aren’t talking a seemingly endless number of months anymore. And the average phone wait time for the agency has recently decreased from 27 minutes to four minutes – and beyond that, just the fact that you can get through to them on the phone to start (for those are only wait times for those whose call is answered) is a welcome change too.

So even if the IRS is an entity that is hard to ever feel THAT positive about (it seems like it just takes our money after all), let’s give credit where credit is due … and it is at this time.

Warmly,

Josh Bousquet
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Well – we made it.

Again.

(Slow exhale)
It happens every tax season, a marathon that ends with a complete sprint. It is trying, it is tiring, it can be difficult, but we always make it through. And as always with every tax season, we want to give thanks to you for sticking with us through the process.

In many ways this felt like the most ‘normal’ tax filing season in a few years since we weren’t having to handle as many pandemic tangents to worry about – something that is good on its own apart from any tax consequences. So the sense of normality that can settle in here once the first season ends (yes, we do still remember all of you on extension) feels a little closer than it has the last couple years.

But even so, that wouldn’t be possible if it weren’t for all of you who work with us. If we didn’t have that connection with so many, we wouldn’t have this long race. If we didn’t have that connection with so many, we wouldn’t be left with the feeling of accomplishment and satisfaction that we get in this time.

So thank you for giving it to us and let’s do it again next year.

Warmly,

Josh Bousquet
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As tax season now heads into its final stretch, I am sure there is a feeling of relief for many of you who have finished the ordeal. And for those of you who have not, well, we discussed extensions in this space last week, you might want to check that out.

Beyond that, we are just working diligently, head-down here for a bit until we reach the end of tax season and get a redemptive breath next week.

That wonderful mid-April moment feels like such an endpoint, and it is one that we will very much enjoy here. At the same time, though, this feels like a good time to remind people that some things do not end with the conclusion of tax season.

The IRS recently finished up its yearly roundup of the Dirty Dozen tax scams. We have talked about some of these here in the past (including a recent deeper look at Employee Retention Credit claims), so I won’t go into any of them here. But I did want to provide this link to the agency’s roundup so that those who are interested in staying on top of these things can see the rest of their information.

Scams do tend to amp up a bit at this time of year, because it is when tax issues (and worries) can be on more people’s minds. It’s important to always retain a healthy amount of skepticism, though, and we will try to keep you updated on any big new scams that come up …

… once tax season ends.

Warmly,

Josh Bousquet
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Well it has happened … it is April.

I know, we can barely believe it either.

And yes, that means that if you haven’t already filed your taxes, it is probably time to think about getting an extension.

Often, I know that can feel like a defeat. It is as if you didn’t hit a deadline and the extension is an admission that you did not do what you were supposed to do. And of course, it is still possible to probably rush, get through it, and still hit that dreaded date. But will you still be able to put forward your best tax return with that strategy? Quite possibly not. So instead, think of the extension as a way to help put yourself in the best position.

At the same time, though, this comes with a warning. Getting an extension gives you legal extra time to file your taxes but it does not gain you any extra time to pay your taxes. So if you come to the end of the return and you do owe money, an extension doesn’t mean that you get six more months to pay that amount. Once the original April 17 deadline passes, you are immediately subject to potential interest and penalties.

So with all this, what do you do now?

Well, there is no definite answer for everyone as there is a lot that can come into play. If you have a simple return, can file it yourself or find someone to do it to you, then it is probably best to just do so and get it out of the way. This is especially true if you are expecting a refund, for why not just do what you can to get that money as soon as possible? Even if you don’t need it right now, it’s better for you to have access to it than let the government hold onto it. If you are expecting to owe money, however, the sooner you start to work on handling that, the more stress you can let ease away and the sooner you start paying, quite likely the less you will end up paying in the end. But then again, if you simply are not ready to file, and do not have all the information you need to do so, the priority should be to gather that so you can start to get answers.

Overall, extensions aren’t defeats, and can often be necessary. At the same time, though, they should happen as part of a plan. So if you have procrastinated in a way that you have no answers to any of these questions, it is time to start knowing the answers to them. That way, even if you do get an extension on your return, you are still on a path that you know where it is taking you.

Warmly,

Josh Bousquet
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