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Extra caution urged for child tax credit, stimulus recipients as tax filing season begins

Published: Jan. 24, 2022 at 6:07 PM CST
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LUBBOCK, Texas (KCBD) - On the first day of the 2022 tax season the Internal Revenue Service is reporting delays and is urging taxpayers to take extra precautions to file an accurate tax return electronically to help speed up refunds.

Lubbock CPA Brad R. Smith tells KCBD during this high stress time it’s important for taxpayers to be organized, especially those who will need notices about their advanced Child Tax Credit and/or economic stimulus payment.

“The IRS should be sending out notices to taxpayers stating what they believe was sent out to the taxpayer,” Smith said. “I think it’s really important that taxpayers have that information and then put it on their return accurately so there’s not a conflict with what the IRS is saying.”

The Child Tax Credit information should come in letter 6419, which will help parents accurately report the amount of money they received in 2021.

“We had some people take that money,” Smith said. “We had some people elect out of it. What’s going to happen now, when you file the 2021 returns, you obviously get your normal child credits that you’re eligible for, but you’re going to need to reconcile with that amount. Basically, if you got some of that advance, you’re not going to get potentially as big a refund as you might have normally got.”

Most Americans received a third stimulus payment from Coronavirus relief legislation in 2021. That should be reflected in the Third Economic Impact Payment letter 6475.

“If you’re used to seeing W2s, 1099s, it’s going to look a little different,” Smith said. “The best bit of advice is anything that you get from the IRS, especially if it says ‘important tax information,’ generally it’s not something you want to ignore.”

Smith advises taxpayers to have the documents organized and collected before beginning the filing process or seeking assistance. In agreement with the IRS, he suggests filing electronically and having direct deposit information for any refund.

“We’re still going to probably have delays of refunds,” Smith said. “That’s frustrated people in the past, over the last year, not getting a refund as quick. I think we’re probably going to have as much that, if not more, because of some of these new things. I think that’s also going to make it more important to file early, file accurately, and at least get it in the system so they can start working on their end.”

On Monday the IRS was reporting delays with live phone support, processing tax returns filed on paper, answering mail from taxpayers and reviewing tax returns, even for returns filed electronically. Taxpayers are asked to seek online help at IRS.gov before calling.

For those who have not had their 2020 tax return processed, you can still file your 2021 return.

The filing deadline is April 18 for most taxpayers.

For more information from the IRS, click here.

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