Some Lingering Questions
You thought tax season was over, but there are always lingering questions following it. I wanted to address them here today so then we could leave the tax stuff behind for a little while.
One of the biggest questions people have after they file their taxes is when they can expect to receive their refund. I certainly understand why people have this question, some of those refunds are sizable and we always want to know when we can expect a big check. Unfortunately, when people come to us with this question, we do not have any secret Batphone way to get an answer or to push things up the calendar. We can say that if you are expecting a direct deposit instead of a paper check, you can expect your refund earlier. When it comes to just how early, though, the best way to get that answer is by using the IRS’s “Where’s My Refund” page, which can be accessed via this link.
That is definitely the biggest question we field from those who have already filed their taxes, but this post-tax season time also comes with plenty of questions from those who have not yet filed. The answer to these questions varies depending upon one’s situation.
First, if you filed an extension for your taxes, remember it is only an extension for filing, not for paying anything you owe. Tax owed and not paid by May 17 can be subject to penalties and interest. If you are in that situation, filing as soon as possible can be a good strategy. That will at least let you know where things stand and start to determine what you must pay and how to pay it.
Next, if you owe taxes from 2020, did not file your taxes, and did not file for an extension, then you are opening yourself up to even more of those potential penalties. Pretending that what you owe doesn’t exist only lets those penalties and interest grow, so it becomes even more crucial to get the filing done and start to figure out how to handle your outstanding burden.
Remember all those tax forms you received that tell you what you earned last year? Those also went to the IRS, so they know if you are going to owe them money. Of course, this also means that the agency knows if you are expecting a refund. And that brings us to the last group of people, those who have not filed but are expecting to get that money back.
To start, what are you waiting for? It is great if you don’t need that money and aren’t worrying about it, but why let the government hold it for you? Get it into your own account and let yourself get a little interest instead of someone else. Beyond that, there is no penalty involved if you are late in filing the paperwork that tells the IRS you want your refund, but it also means the agency is not going to try to track you down and give you the money owed to you.
So no matter what situation you are in, the takeaway in all of them is that acting quickly serves you better than waiting. And once you do that, we really can leave this tax season behind.
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To ensure we don't make the folks at the IRS ornery, we inform you that any U.S. federal tax advice contained in this communication (including any attachments) is not intended or written to be used, and cannot be used, for the purpose of (i) avoiding penalties under the Internal Revenue Code or (ii) promoting, marketing, or recommending to another party any transaction or matter addressed herein.
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