Tax and Stimulus Check Questions Answered for 2021 Tax Season
When will your $600 Stimulus Check arrive and what if you didn’t file a return last year for 2019? Luis Garcia of the IRS was a guest on the 95.3 WBCK Morning Show with Tim Collins and answered questions.
When can we expect our $600 Stimulus Check and what if we didn’t file a 2019 return?
“As of last Friday, February 12th, all of the stimulus payments have been issued. We are done sending them, and as required by law they have been issued, regardless of whether you filed in 2019. If you’ve filed electronically and asked for a direct deposit, you’ll get the funds much quicker.”
What about Michigan’s unemployment scammers? What do you do if you get a 1099 showing unemployment payments that you never received?
“Well, the most important thing is to realize that, in all likelihood, you've been the victim of identity theft. Somebody else pretending to you has gotten some money. So take the steps to protect yourself by going through the federal trade commission website, and make sure you review your credit reports immediately and consider a credit freeze. But the, as far as taxes are concerned, go back to the Michigan department of treasury and tell them that you never received any of these benefits. When you clarify with the state of Michigan that you are a victim of identity theft, they will, in turn, let the IRS know that you did not receive those benefits.
What about wait times on calling the IRS?
People who call the IRS have a one in 11 chance that anybody will even answer the phone, and they get an estimated 500 million calls a year. If we have a question and can't get through, what should we do?
Garcia said the IRS is doing the best they can with the budget and recourses they have but says the IRS website, www.irs.gov is a great resource. “Everything is there, and it’s written in as normal human English as possible. It's not legalese or complicated tax talk. It’s written in a way that is understandable to most people and there are all kinds of tools and portals to things like “Free-File” where you can do your taxes for free. But if you start with the phone first, you're going to get very frustrated.”
Garcia cautions that there's only one legitimate IRS online site: www.IRS.gov and anything else is not the IRS. “There are people that prey on people wanting information and they offer to do your taxes for free and all this stuff.”
What happens if we don’t file a return?
Garcia said the vast majority of people, almost 80% in Michigan, get a refund. “So if you don't file and you're owed a refund, you're just hurting yourself. You're just letting us hold on to your money. If you’re owed a refund, you won't be panelized for filing late. But if you owe money and don’t file, there is a penalty and a fee. The worst thing that you can do is not file and ignore it because it always will catch up with you.”
Selecting a Tax Preparer
Garcia says that people need to take a lot of time in selecting a tax preparer if we’re not going to do it ourselves. “You know, some people take more time figuring out what TV shows they're going to watch over the weekend than who they're going to give all this very important information to. This is the one time of year where you give, in some cases a complete stranger, your social security number, your spouse’s and children’s social security numbers, dates of birth, bank account numbers---all this really important stuff. And everybody who prepares taxes for money must register with the IRS and you can look them up online to make sure they are there and look up their tax identification number.”
Garcia says many preparers promise big refunds and then enter all sorts of information on your return. “And when the IRS comes knocking to say, ‘hey you claimed 20 children, where are they? Um, that person is going to disappear and you're going to be left holding the bag.”
How difficult is it to get signed up for electronic filing?
“Well, it's easy as pie, and whether you're using the software that you purchased or the free file software at www.irs.gov You basically just answer a bunch of questions and put your information in, and hit “send.” You’ll need bank routing info, for direct deposit into a bank account. Garcia says the IRS does not work with PayPal, but he said those without bank accounts can use a debit card, such as those purchased at a grocery store. They can operate like a bank account, and we can have the money direct deposited to that.”
Is the filing software free?
There is a partnership between the IRS and nine different tax preparation software companies. But what many people don’t know is that this is free if you make less than $72,000 per year, and that’s about 70% of Americans. So you can go to irs.gov, click on “Free-File” and find out which of these companies best suits you.” Garcia said going to a search engine could direct you to a place that says it’s free, but it’s not. He says that happened to his daughter. “She went online and searched the legitimate website of the company that she wanted, spent an hour putting in her information, and when she's about to hit send, it says you owe $62.00. If you make less than $72,000, go to www.fcc.gov first.”