IRS: 2021 Filing Season Begins February 12

by | Jan 22, 2021 | 2021, Family and Consumer Sciences, Money Management

Taxes, without a doubt, conjure up emotions from elation to dread! Do you owe? Are you getting a refund? Are you uncertain?

 

This is a significant statement because income tax returns cannot be filed electronically or by mail until the IRS has opened the season.

Please, do not be influenced to apply for a tax refund loan, typically known as a RAL (refund anticipation loan), if you are not in a crisis for the money. An RAL is a loan based on the anticipated amount of your federal income tax refund. Many tax filing services will offer you a RAL if… you file with their service. Your loan amount will be the value of your anticipated refund minus fees and/or interest charges.

Know, too, that your loan will go directly to the lender once the IRS processes your income tax return.

Be VERY careful with refund anticipation loans. An obvious positive attribute of the loan is you get money quickly – before the season even opens. Another, once the lender receives your refund, the loan is paid. But, what happens if your tax refund is smaller than the anticipated income tax return? You now will have an outstanding loan that will need to be paid back.

The Earned Income Tax Credit (EIC or EITC) is a refundable tax credit for low- and moderate-income workers. For 2020, the earned income tax credit ranges from $538 to $6,660. The amount depends on income and number of children; people without kids can qualify, too.

If you qualify for the EITC, you need to know, by law, the IRS cannot issue refunds for people claiming the EITC or the Additional Child Tax Credit (ACTC) before mid-February. The IRS cannot release these refunds before February 15, but the IRS is saying to expect your refund by the first week of March. Note, too, the law requires the IRS to hold the entire refund − even the portion not associated with the EITC or ACTC. This law change, which took effect in 2017, helps ensure that taxpayers receive the refund they are due by giving the IRS more time to detect and prevent fraud. 

Now, while waiting for the tax filing season to open, is a great time to get income tax documents together. Once the filing season opens, being organized and prepared will help facilitate a seamless transition to filing your income tax return. The IRS recommends that taxpayers file their returns electronically to reduce errors and receive refunds more quickly.

Filing an average income tax form is also easy. There are many FREE income tax filing sites.

Income $72,000 and below: Contact your local UF/IFAS Extension office and they can help you by:

  • Finding FREE federal tax filing on an IRS partner site
  • Finding guided preparation – simply answer questions
  • Providing a link to a FREE Facilitated Self-Assisted (FSA) service with electronic forms you fill out and file yourself

Income above $72,000: Contact your local UF/IFAS Extension office and they can help you by:

  • Providing a link to a FREE Facilitated Self-Assisted (FSA) service with electronic forms you fill out and file yourself
  • Helping you learn how to prepare papers for meeting with a tax professional
  • Providing you with basic tax preparation information

Be careful in your decision making when it comes to filing income taxes. Choosing e-file and direct deposit for refunds remains the fastest and safest way to file an accurate income tax return and receive a timely refund. It is amazing to know the IRS issues more than 9 out of 10 refunds in less than 21 days.

Source: https://www.irs.gov/filing/free-file-do-your-federal-taxes-for-free#what

 

Heidi Copeland
Latest posts by Heidi Copeland (see all)