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It’s not always easy to manage your taxes. You can find them difficult to handle, especially if you manage to get behind on paying them. When you’re having problems with your taxes, claiming available tax relief can help you to relieve the pressure so that you can breathe again. Tax relief is any program or scheme that allows you to reduce the amount of tax that you owe, which could include property taxes, income tax, and other types of tax that you are required to pay. This article is designed to give you tax relief help so that you can deal with any problems you are having with your taxes.

Tax Relief When You Owe the IRS

There are a few ways you could seek tax relief when you owe the IRS. What you decide to do might depend on whether you need more time to pay your bill or you’re unable to pay it at all. When you’re looking for more time to pay your bill, a payment plan could be the solution that works for you.

The IRS offers short-term payment plans of 120 days or less, or long-term payment plans, which last more than 120 days. With a short-term payment plan, you can owe a maximum of $100,000 and it is free to apply, with the option of paying through automatic withdrawals from your checking account, by check, money order, or by credit or debit card. Long-term payment plans can be for up to $50,000, with fees of up to $225 to apply, depending on how you choose to pay and which method you use to apply. The cheapest method is to apply on the IRS website.

If you choose tax relief via a payment plan, interest and penalties for late payment will still accrue until you have paid off what you owe.

Another option when you owe taxes to the IRS is an offer in compromise. Using this option, you can pay less than you owe if you can’t pay your taxes or if paying your bill will mean you experience financial hardship. This option is not as easily accessible, with only around half of requests accepted, but getting professional help with tax relief can help you. You will need to fill out IRS Form 656-B and pay a non-refundable $205 fee and initial payment.

Finally, you can ask to have your account marked as Currently Not Collectible. This indicates that you can’t pay your taxes or your living expenses. It is a temporary solution, and you will have your finances reviewed each year to see if your income has improved. It also only puts your tax on hold. It doesn’t make it go away, and the IRS might file a tax lien.

Tax Relief on State Taxes

If you are struggling with state taxes, there may also be tax relief help available for you. Many states handle tax relief in a similar way to the IRS, but each state has different rules and tax relief processes. When you use tax relief experts to help you, you can navigate the options available in your state. If you want to find out more information, you can check your state’s website.

Tax Relief on Property Taxes

Some people may be able to get tax relief help with their property taxes. For example, in New York, property tax relief is automatically applied for those who meet the criteria. Most states offer property tax relief based on homestead exemptions, providing relief for homeowners who claim their primary residence in that state. Some states might have property tax relief programs based on other factors, such as the age or the income of the homeowner. If you want to claim tax relief on your property tax, you should look at your state’s website to find out what is available.

Tax Relief for Expatriates

Another type of tax relief that is available is tax relief for expatriates. American citizens living and earning money outside of the US still have an obligation to pay tax in the country. However, they have a tax relief of $105,900, which they can apply for through the Foreign Earned Income Exclusion. This means that they only need to pay for any money that they earn above the exempt amount.

There are various forms of tax relief that you can benefit from, both before you find yourself struggling to pay your bills and when you start experiencing problems. With help from tax relief experts, you can address your issues.

Both individuals and businesses have experienced the impact of the COVID-19 outbreak. The Coronavirus Aid, Relief and Economic Security (CARES) Act was signed into law to provide financial support during the public health crisis. The Act builds on two pieces of legislation previously passed to offer more support to businesses and individuals. The changes include alterations to tax policy. But who can benefit from the CARES Act? There are several parts to the bill, which are designed to help individuals earning at different levels and businesses too.

The Recovery Rebate

About half of the tax cuts are accounted for by the recovery rebate for individual taxpayers. This provides $1,200 refundable tax credit for individuals or $2,400 for joint taxpayers, as well as $500 for each child. It is credited against tax liability and refundable for those with no liability to offset, so the rebates won’t be counted as taxable income. The rebates are calculated using 2019 tax returns or 2018 tax returns if they haven’t been filed. After filing a 2020 tax return, those who are eligible for a larger rebate can claim the difference.

The rebate phases out at 5 percent per dollar of qualified income, or $50 per $1,000 earned for:

  • $75,000 for singles
  • $112,500 for heads of households
  • $150,000 for joint taxpayers

It phases out entirely for single taxpayers with no children at $99,000 and $198,000 for joint taxpayers. Dependent children under age 17 are taken into account for this purpose. Those with no income or very little income are still eligible for the rebate, as long as they are not a dependent of someone else and have a work-eligible SSN.

Seniors whose income comes solely from Social Security, veterans whose income is from disability payments and people in similar situations are eligible if they are not a dependent of anyone else. The rebate can be based on Form SSA-1099, Social Security Benefit Statement or Form RRB-1099 to help seniors. However, seniors should still file their 2019 tax return as soon as they can to receive their rebate as quickly as possible.

So how do you get your rebate? Most people will not have to do anything to benefit from this tax relief. As it will be based on your tax return for 2019, or for 2018 if you have yet to file your 2019 return, there is no need to apply for anything. Even if you do not owe any tax due to low income, you will be eligible. If you have not filed your 2019 tax return yet, you should do it as soon as possible.

Business Benefits from the CARES Act

Most of the remaining tax cuts from the CARES Act go to businesses. Employers can claim a 50% refundable payroll tax credit on wages paid up to $10,000. Businesses that have been affected by shutdowns during the health crisis and those who have experienced a decrease in gross income compared to last year are eligible for the credit. It is to be used for employees who are still employed by the company but are not currently working due to the crisis if a business has more than 100 employees. If there are 100 or fewer employees, it can be used to pay all employee wages.

Businesses also benefit from an employer payroll tax deferral. Another benefit to businesses is that restrictions from the Tax Cuts and Jobs Act (TCJA) have been loosened. Active losses to pass-through businesses can be offset against other forms of income, with no limit in place. This will primarily benefit high-earning households, with incomes over $1 million. Other benefits to business include looser limits on net operating loss carrybacks and interest deductions. Employers and self-employed people can also delay the payment of their Social Security taxes, which will then be due to be paid over two years. This measure is available to all businesses, regardless of whether the crisis has affected them.

While businesses see many benefits from the tax relief measures in the CARES Act, individuals also gain some help. Almost half of the money spent as a result of the Act will go to helping low and middle-income individuals and families keep their finances boosted during this difficult period. If you are eligible for a rebate, you will automatically receive it, so you don’t need to take any action. Filing your 2019 tax return, if you haven’t already done so, is a sensible thing to do.

tax relief nyClearly, COVID-19 is the center of everyone’s attention right now. As a country, we’re all worried about what this virus is doing and what it means for our lives. Aside from the obvious health implications, COVID-19 has also impacted us financially. Businesses are suffering economically, as our individuals. Consequently, the federal and local governments are doing all they can to provide some sort of tax relief. In the state of New York, there are currently a few measures in place to be aware of.

COVID tax relief in NY will be in place to help both businesses and individuals deal with the financial implications of this deadly virus. With that in mind, here’s everything you need to know:

Changes to tax return dates

There have been two major changes to the tax return dates for individuals in New York. Firstly, the due date for filing federal income tax has been extended from April 15, 2020, to July 15, 2020. This provides you with an extra three months to get all of your federal tax in order. Alongside this, the New York State Budget Director also moved the due date for filing New York State income tax returns to July 15, 2020.

Any tax payments that were due on April 15, 2020, can now be deferred to the new date. Furthermore, you won’t be penalized or forced to pay interest in these payments.

Sales tax waivers

Anyone in the state of New York that had to pay sales tax would’ve been required to make payments by March 20, 2020. Obviously, this date has already been passed and it hasn’t been extended or changed. However, penalty interest may be waived for quarterly and annual filers if payments weren’t made on time thanks to the coronavirus outbreak. You can request relief for this online to see if you qualify for the waiver.

NYC Real Property Transfer Tax waivers

If you have to pay NYC Real Property Transfer Tax, then there is a waiver in place for late filings on returns due between March 15 and April 25, 2020. You won’t receive any penalty fees for making a late payment at this time. However, as of writing this, any interest on late payments will not be waived and will still have to be paid.

Altering scheduled payments

A lot of you may already have scheduled payments set up for tax returns. This means that you’ve agreed to make regular payments at specific intervals throughout the tax year. However, due to the COVID-19 outbreak, you may be unable to keep up with these payments. Thankfully, the state of New York is making changes to accommodate people in this position.

If you’ve already calculated your tax return and set up a direct debit for April 15, 2020 – but fear you cannot afford the payment at that time – then you can cancel it and reschedule the payment for the new tax date of July 15, 2020. This can easily be done online by accessing your tax return account.

Alternatively, if you are unable to make a regularly scheduled payment thanks to COVID-19, then you can call the Tax Department to discuss this. It’s recommended that you have your Social Security number or EIN to make the call go smoother.

Payroll tax credits for employers

If you are an employer with a small/medium-sized business that has under 500 employees, then you are entitled to refundable payroll tax credit by the New York State government. This is specifically to cover payments for employees that are unable to work due to sickness or family leave.

Naturally, there are requirements that must be met to qualify for this tax relief:

  • For sick pay credits, the employees must be under self-quarantine at the advice of a healthcare professional, under a federal isolation order, or show signs of COVID-19 with a medical diagnosis. Therefore, it doesn’t cover instances where an employee is sick for a reason not relating to COVID.
  • For family leave credits, the employees must be unable to work due to caring for family members directly affected by the virus. This obviously includes family members with the virus, but also children who are at home because their schools have closed. If an employee is unable to work because of this, then you can claim tax relief credits to pay them.

These credits are only available for payments for up to ten days of wages paid per employee per quarter. There’s a maximum of $200 per day for family leave credits, and a maximum of $511 per day for sick leave credits.

Recovery rebate credits

This doesn’t solely affect New York, but it is still well worth mentioning if you’re looking for COVID tax relief in NY. With this law, all US resident individuals are eligible for the full $1200 tax rebate. You are also eligible for an extra $500 per qualifying child, provided this child has a social security number or adoption taxpayer identification number.

Of course, there are some key requirements that you need to meet to be eligible for recovery rebate credits:

  • You must be a US resident
  • You must file the tax return as an individual – married couples can file for one each
  • You need to have adjusted gross income of up to $75000 ($150000 for married couples)

Future COVID-19 tax relief for New York

As of right now, these are the main things to be aware of with regards to COVID tax relief in NY. The most significant steps have been the extension of the tax year and the waiving of certain penalty fees and interest. There have been calls by the New York State speaker to introduce further tax relief for the people of this state. However, it’s impossible to predict what this might be and when it may come into effect.

With that being said, it’s reasonable to assume that further measures may be introduced as this situation continues to get worse. More businesses may need to shut down, more self-employed people may be without work, and so on. If there are any further tax relief updates for the state of New York, then we’ll update this article as they happen!

The government has introduced a gigantic $2 trillion relief package to fight the economic effects of the coronavirus outbreak. Currently, one of the main benefits of this package is a stimulus check for eligible US taxpayers. The first one of these checks is believed to arrive sometime in April, and you can have it deposited to your bank account right away.

Anyone that’s eligible for this coronavirus relief check will receive up to $1,200. It’s seen as an economic payment by the IRS to try and help those who have been suffering financially thanks to this pandemic.

The requirements for this check are quite lenient in that nearly 9 out of 10 US households can qualify for it. However, not all of those who qualify will receive the full amount, and some of you might not meet the requirements at all.

Keeping that in mind, how do you know if you qualify for a coronavirus relief check? We’ve looked into things and can present the main eligibility requirements for you – along with how much money you can expect to receive.

Eligibility is based on your total income

To be eligible for this relief check, you need to look at your adjusted gross income over the last two years. Here are the parameters you have to meet:

  • An adjusted gross income of less than $99,000 – This is for individual US residents
  • An income under $146,500 – This is for people who are filing as the head of a household
  • An income of less than $198,000 – This is for couples that marry jointly and don’t have any children

As you can see, most of you will probably fall into at least one of these brackets. Of course, you need to be a US citizen and pay taxes as well.

It’s also well worth mentioning that the IRS recommends you file your 2018 federal taxes right now. If you haven’t already done this, then it may alter your stimulus check and mean you’re either not eligible or will receive less than you think you should.

If you don’t usually file a tax return, then you won’t need to make an exception to receive your chunk of the stimulus package.

How much money do you qualify for?

The next big question revolves around how much of the $1,200 you’re eligible for. The good news is that a lot of you may receive the full amount. In general, the more you earn, the less you’ll be entitled to.

For an individual US resident with an adjusted gross income under $75,000, you will get the entire $1,200 relief check. Now, bear in mind that you can earn under $99,000 to qualify for relief. So, the closer your earnings get to the $99,000, the more the relief is reduced.

A similar situation is in place for anyone filing as the head of a household. The limit is an annual income of $146,500. However, to qualify for the full $1,200, you need to earn under $112,500. Again, your relief check is reduced as your income rises closer to the limit.

Finally, couples filing together need to earn below $150,000 for a $2,400 payment. This is because you get $1,200 per individual. Of course, this will decrease all the way down to zero, the closer you get to earning $198,000. It’s also worth pointing out that you get an extra payment of $500 for every child you have. In this case, a child is classified as anyone under the age of 16.

How do you get your coronavirus relief check?

Do you meet the requirements listed above? If so, then you need to set up a direct deposit with the IRS. This is pretty simple to do, and you can go on their website to get it all sorted out. There is also an online system that will be set up in mid-April for people that want electronic payments with a direct debit.

It’s believed that the first checks will be sent out within around two weeks or writing this article. So, make sure you get a direct deposit sorted out if you want the fastest and most secure payment method. You can also have the check mailed to you, but this isn’t recommended.

Hopefully, this gives you all the vital information you need to know about qualifying for a coronavirus relief check. If you do qualify – and haven’t acted yet – then be sure you act fast to get the money as quickly as possible.

Hand Clicking Tax Refund Button On A Screen InterfaceYou know that feeling you get when you find some money that you didn’t know you had? Or maybe you’ve overpaid on a bill, like an escrow account for example, and an unexpected check shows up in the mail. That’s a great feeling. Sometimes people are even fortunate enough to stumble across money lying on the ground whose owner apparently is nowhere to be found. Even finding a $20 bill in your coat pocket when you weren’t expecting it could be cause for celebration. The bottom line is it’s always nice to be on the receiving end of money that you either didn’t know you had or that you weren’t expecting to get.

With the IRS Nothing’s For Free

In much the same way, receiving a tax refund is usually a great feeling. After all who doesn’t like to get a few extra hundred or even a few thousand dollars in one fell swoop? In all of these scenarios this money is typically yours to keep without any repercussions. However, what would you do if you ended up getting a much larger tax refund than you were expecting? The tax season ended just a few weeks ago, but while many people have already received, deposited and even spent their refunds, those who waited till the deadline to file could also still be waiting for their refund to come. So what should you do if the IRS refunds you too much money? Can you simply keep it and chalk it up to the belief that it’s their error so it’s their problem? Do you sit on the check for a while and wait it out to see if the IRS figures out its mistake? Or, do you fess up and let the tax agency know they screwed up?

Avoid a Spending Spree

Of course it would be very tempting to keep the extra money and it might feel good to give the IRS a little “payback” so to speak. However, if the IRS overpays you don’t start making plans to take an extra vacation, buy a new car or give your savings account an extra boost. Instead be prepared to give it back. Sometimes, the IRS does find mistakes in your calculations or entries and it will send you a bigger refund than you were expecting. If that is the case it will most likely send you a notice in the mail explaining the reason. However, if you don’t receive an explanation and you know you were over-refunded then don’t spend the money because chances are the IRS will discover its mistake sooner or later.

Act Fast and Fight to Give it Back

The best thing you can do in this situation is contact the IRS immediately and let them know what happened. In fact, if you hold onto the money and the IRS discovers the error six months, or even a year later, they will actually not only expect you to return the full amount, but they will also ask for interest and in some cases penalties. That sounds completely unfair, but it happens more often than you might think. One couple ended up in a heated battle after the IRS refunded them too much money. Even though they attempted to return the money right away and were initially turned away by the IRS, eventually the agency came calling and tried to force them to pay interest. They fought the IRS for two years before the issue was finally resolved. The lesson here is to do whatever it takes to pay the money back ASAP if you know the IRS has made a mistake, even if they tell you everything is fine.

Make Sure It’s Not Your Error

Tax policy states that penalties and interest depend on who committed the error. According to the IRS, “taxpayers are not liable for penalties and interest on erroneous refunds until the IRS asks the taxpayer for repayment. But this is contingent upon the presence of both of the following: The IRS must be clearly at fault in generating the erroneous refund; and the amount of the refund cannot be greater than $50,000.” However, be prepared to fight because the IRS doesn’t give up easily and the agency will always look to find fault in the taxpayer, rather than itself.

If It Seems to Good to Be True it Probably Is

So to recap, if the IRS overpays you don’t spend it and do everything in your power to return the money as swiftly as possible. It’s great to receive an unexpected check in the mail but if it comes from the IRS then always assume a mistake has been made until the agency can assure you otherwise. In the meantime, if you need a little extra cash, then start searching all those extra coat pockets. You might be lucky enough to find enough to buy yourself a nice dinner without having to worry about the IRS charging you any penalties or interest.

 

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