The tax season of 2019 is open: why it will be difficult and what you need to know

Shatdaun completed, at least for the moment, and the staff of the IRS again perform their duties. Will there be a delay in tax returns in 2019? Will the new laws affect how to file tax returns? Surely one thing can be said: the tax season of 2019 of the year began on January 28, and so far everything is very foggy. Let's try to figure out what is already known.

Фото: Depositphotos

According to the IRS, employees began processing tax returns on Monday, writes Money.

The situation is still confused even for tax professionals: it is now difficult to determine what impact the shatdown and the Law on the Reduction of Taxes and Jobs will have on tax returns and refunds in the 2019 year.

Here are some basic issues you need to know about.

How tax cuts will affect returns and returns

Many expect particularly large tax refunds in 2019, the first tax season in which the Trump administration will cut taxes by $1,5 trillion in full. The average tax refund in 2019 will actually be higher than last year.

Does this mean that you will get a big tax refund this year? Not necessary. Tax cuts changed the amount of US debt, but most taxpayers who were positively affected by the change have already paid less federal taxes during the 2018 year. Therefore, a significant tax reduction does not mean that you get a big refund. It all depends on how much you have already paid.

You will only receive a refund if you overpaid - unfortunately, changes in the tax code make it very difficult to determine in advance whether you overpaid and, as a result, whether you will receive a refund.

In addition to lowering personal income tax rates, the Law on Reducing Taxes and Jobs Increased Standard Deductions and Child Tax Benefits, while limiting tax deductions to state and local governments and eliminating personal benefits. Overall, the new tax changes "created confusion about the right amount, which could have been deducted in advance from the workers' wages," the New York Times said.

Worse, the IRS "expects more people than usual to pay taxes and fines, including those who usually get reimbursed," writes the Wall Street Journal.

“Those who deposited classified deductions earlier are most at risk and have now stopped; as well as households with two employees and people in difficult situations. ”

Фото: Depositphotos

How government shatown affects tax returns

The partial closure of the government, which lasted more than a month, ended on Friday, when President Trump and Congress agreed to reopen the government for three weeks in parallel with the negotiations on Trump's demands for financing the border wall.

The IRS said it would process tax returns and pay refunds regardless of whether the government closed in 2019. But many experts say that delays in tax refunds this year are possible, even if the government does not close again. Objectively, the tax season was not easy even without a shatdaun, and the closure of the government significantly complicated the work of the IRS.

At the weekend, the Washington Post reported that due to the closure, the IRS could not properly prepare for the 2019 tax season of the year. Thousands of agency workers still need training or hiring, millions of mail from taxpayers linger.

“It could take at least a year for the IRS to return to normal operations,” two anonymous House staffers told the Washington Post, according to the government watchdog group that oversees the tax collector.

IRS customer service can also be a problem. Over the past few years, the average waiting time for a conversation with an IRS employee varied from 15 to 30 minutes, and only 40% of taxpayers who turn to the IRS for help actually end the conversation with the agent.

IRS call center wait times and customer service “may deteriorate this season,” the Tax Policy Center said, both because of the shutdown and additional impacts from the new law and problems with agency employees.

“IRS morale has been low for years. This will likely worsen the situation,” the Center notes.

The result?

Completing and filing tax returns is challenging at any time, but in 2019, taxpayers should be prepared for some extra hassle. It is still difficult to figure out whether you will receive any refund, and if so, what kind. You may pay additional taxes and penalties, and this is also impossible to say for sure.

The entire process can be fraught with delays and confusion—even if there is a tax refund, there will be a long wait.

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