Mr. Dennis Grogan–one of R&G Brenner’s Senior Tax Consultants & an Enrolled Agent at our Midtown Manhattan location–was recently interviewed by the NY Daily News. Here’s what he had to say about this upcoming tax season:
Attention early birds: starting Tuesday, Jan. 17, you can officially file your taxes electronically.
And the sooner, the better — if you’re expecting a refund and have all the necessary documents.
“Typically, the volume is lower early in the year so that will usually result in getting a refund faster,” said Ed Walsh, spokeman for the New York State Department of Taxation and Finance.
“Filing electronically also can have the benefit of making your refund go faster, because there are typically more mistakes associated with paper filing. And there is more manual work to process.”
Those filing immediately can expect a state refund to arrive by the end of January if there are no mistakes or complex issues, Walsh said. It should take between 16 and 30 days on average.
For Federal income taxes, the majority of refunds are processed within 21 days.
“We’ll issue refunds to taxpayers in as few as 10 days when they file electronically and select direct deposit,” said IRS spokeswoman Dianne Besunder. “That’s assuming there are no corrections or reviews required.”
The most common mistakes the IRS sees are errors involving Social Security numbers. Either the name on a submitted form doesn’t match the exact spelling on the corresponding person’s Social Security card, or the numbers of dependents or a spouse aren’t included when necessary.
Be sure to always include any documents to back up what you are claiming.
“One thing with New York that was really a problem last year, if you had Earned Income Tax Credits for any kind of a rental property or if you had children, they sent letters back to the people within a week asking for substantiation,” said Dennis Grogan, an enrolled agent with R&G Brenner.
“That became a real issue … if you had three or four children and a low income and you were getting a lot of credits, they’d ask for the birth certificates and letters from the school.”
And filers didn’t get those refunds until they provided proof for what was in question.
“I think it’s probably going to get worse,” Grogan said. “Make sure whatever you claim, you have.”
Tax tips
1. For the first time, New York State is offering a prepaid debit card as a refund option. This benefits those who don’t have bank accounts and can’t use direct deposit, and in the past had to opt for a paper check, which takes longer. The card can be used at retail stores. It can also be used to withdraw money at ATMs without transaction charges at banks affiliated with MasterCard and Allpoint.
2. Take advantage of Free File at irs.gov/efile. If your income is $57,000 or less, Free File’s brand-name software does the work with free tax preparation and free e-filing.
Regardless of income, everyone can use Fillable Forms on the same site — electronic versions of the IRS paper forms. This option is best for people who are comfortable preparing their tax returns but want the advantages of fast, secure and free e-filing. Fillable Forms does only basic math and does not support state tax returns.
3. This is the first year that same-sex married couples will be filing jointly in New York. “So the tip that we’re giving is for same-sex married couples to fill out a federal joint return, not to submit it, but that’s how you bring the information over to a joint New York State Tax return,” advises Ed Walsh, spokesman for the New York State Department of Taxation and Finance. “Because figuring out your New York State adjusted gross income starts with the Federal Return. Then just save that to mock joint return for their records and then file individually at the federal level.”
4. Be sure to have last year’s tax return, your W-2s, 1099s, interest statements from banks, stock distributions, and all other necessary receipts and supporting documents before you start the filing process. Your refund could be held up if anything is missing or wrong.
5. Research and be familiar with all Earned Income Tax Credits, which can be very valuable to low or moderate income families. There is an interactive tool on the IRS.gov web site where you can see if you’re eligible for any. “And you do it kind of anonymously,” said IRS spokeswoman Dianne Besunder. “You put in information about your income, your filing status, whether you have dependents.”
