Report Life Changes to the Marketplace

IRS Health Care Tax Tip 2015-69, October 29, 2015

If you enrolled in insurance coverage through the Health Insurance Marketplace, you are required to report changes to the Marketplace when they happen, like changes to your household income or family size, because they may affect your eligibility for the advance payments of the premium tax credits.

Changes in circumstances that you should report to the Marketplace include, but are not limited to:

• increases or decreases in your household income, including lump sum payments like a lump sum payment of Social Security benefits
• marriage or divorce
• the birth or adoption of a child
• starting a job with health insurance
• gaining or losing your eligibility for other health care coverage
• changing your residence

For the full list of changes you should report, visit HealthCare.gov.

Reporting changes will help you avoid getting too much or too little advance payment of the premium tax credit.  Getting too much means you may owe additional money or get a smaller refund when you file your taxes. Getting too little could mean missing premium assistance to reduce your monthly premiums.  Therefore, it is important that you report changes in circumstances that may have occurred since you signed up for your plan.

When you report a change, you may be eligible for a Special Enrollment Period.  For more information, visit HealthCare.gov.

Source: Internal Revenue Service

IRS Grants Tax Relief to Drought-Stricken Farmers and Ranchers in 48 States and Puerto Rico

IRS Special Edition Tax Tip 2015-19, October 26, 2015

If you are a farmer or rancher forced to sell your livestock because of the drought that affects much of the nation, special IRS tax relief may help you. The IRS has extended the time to replace livestock that their owners were forced to sell due to drought. If you’re eligible, this may help you defer tax on any gains you got from the forced sales. The relief applies to all or part of 48 states and Puerto Rico affected by the drought. Here are several points you should know about this relief:

• Defer Tax on Drought Sales.  If the drought caused you to sell more livestock than usual, you may be able to defer tax on the extra gains from those sales.
  
  
• Replacement Period.  You generally must replace the livestock within a four-year period to postpone the tax. The IRS can extend that period if the drought continues.
  
  
• IRS Grants More Time.  The IRS has added one more year to the replacement period for eligible farmers and ranchers. The one-year extension of time generally applies to certain sales due to drought.
  
  
• Livestock Sales that Apply.  If you are eligible, your gains on sales of livestock that you held for draft, dairy or breeding purposes apply.
  
  
• Livestock Sales that Do Not Apply.  Sales of other livestock, such as those you raised for slaughter or held for sporting purposes and poultry, are not eligible.
  
  
• Areas Eligible for Relief.  The IRS relief applies to any farm in areas suffering exceptional, extreme or severe drought conditions during any weekly period between Sept. 1, 2014, and Aug. 31, 2015. The National Drought Mitigation Center has listed all or parts of 48 states and Puerto Rico that qualify for relief. Any county that borders a county on the NDMC’s list also qualifies.
  
  
• 2011 Drought Sales. This extension immediately impacts drought sales that occurred during 2011.
  
  
• Prior Drought Sales.  However, the IRS has granted previous extensions that affect some of these localities. This means that some drought sales before 2011 are also affected. The IRS will grant additional extensions if severe drought conditions persist.

Get more on this relief in Notice 2015-69 on IRS.gov. This includes a list of states and counties where the IRS relief applies. For more on these tax rules see Publication 225, Farmer’s Tax Guide on IRS.gov.

Each and every taxpayer has a set of fundamental rights they should be aware of when dealing with the IRS. These are your Taxpayer Bill of Rights. Explore your rights and our obligations to protect them on IRS.gov.


Source: Internal Revenue Service

IRS Urges Public to Stay Alert for Scam Phone Calls

IRS Special Edition Tax Tip 2015-18, October 21, 2015

The IRS continues to warn consumers to guard against scam phone calls from thieves intent on stealing their money or their identity. Criminals pose as the IRS to trick victims out of their money or personal information. Here are several tips to help you avoid being a victim of these scams:

• Scammers make unsolicited calls.  Thieves call taxpayers claiming to be IRS officials. They demand that the victim pay a bogus tax bill. They con the victim into sending cash, usually through a prepaid debit card or wire transfer. They may also leave “urgent” callback requests through phone “robo-calls,” or via phishing email.
  
  
• Callers try to scare their victims.  Many phone scams use threats to intimidate and bully a victim into paying. They may even threaten to arrest, deport or revoke the license of their victim if they don’t get the money.
  
  
• Scams use caller ID spoofing.  Scammers often alter caller ID to make it look like the IRS or another agency is calling. The callers use IRS titles and fake badge numbers to appear legitimate. They may use the victim’s name, address and other personal information to make the call sound official.
  
  
• Cons try new tricks all the time.  Some schemes provide an actual IRS address where they tell the victim to mail a receipt for the payment they make. Others use emails that contain a fake IRS document with a phone number or an email address for a reply. These scams often use official IRS letterhead in emails or regular mail that they send to their victims. They try these ploys to make the ruse look official.
  
  
• Scams cost victims over $23 million.  The Treasury Inspector General for Tax Administration, or TIGTA, has received reports of about 736,000 scam contacts since October 2013. Nearly 4,550 victims have collectively paid over $23 million as a result of the scam.

The IRS will not:

• Call you to demand immediate payment. The IRS will not call you if you owe taxes without first sending you a bill in the mail.
  
  
• Demand that you pay taxes and not allow you to question or appeal the amount you owe.
  
  
• Require that you pay your taxes a certain way. For instance, require that you pay with a prepaid debit card.
  
  
• Ask for your credit or debit card numbers over the phone.
  
  
• Threaten to bring in police or other agencies to arrest you for not paying.

If you don’t owe taxes, or have no reason to think that you do:

• Do not give out any information. Hang up immediately.
  
  
• Contact TIGTA to report the call. Use their “IRS Impersonation Scam Reporting” web page. You can also call 800-366-4484 FREE.
  
  
• Report it to the Federal Trade Commission. Use the “FTC Complaint Assistant” on FTC.gov. Please add "IRS Telephone Scam" in the notes.

If you know you owe, or think you may owe tax:

• Call the IRS at 800-829-1040 FREE. IRS workers can help you.

Phone scams first tried to sting older people, new immigrants to the U.S. and those who speak English as a second language. Now the crooks try to swindle just about anyone. And they’ve ripped-off people in every state in the nation.
Stay alert to scams that use the IRS as a lure. Tax scams can happen any time of year, not just at tax time. For more, visit “Tax Scams and Consumer Alerts” on IRS.gov.
Each and every taxpayer has a set of fundamental rights they should be aware of when dealing with the IRS. These are your Taxpayer Bill of Rights. Explore your rights and our obligations to protect them on IRS.gov.

Source: Internal Revenue Service

Extension Filers: Don’t Miss the Oct. 15 Deadline

IRS Special Edition Tax Tip 2015-17, October 2, 2015

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If you are one of the 13 million taxpayers who asked for more time to file your federal tax return and still haven’t filed, your extra time is about to expire. Oct. 15 is the last day to file for most people who requested an automatic six-month extension. If you have not yet filed, here are some things that you should know:

• Try IRS Free File or e-file.  You can still e-file your tax return for free through IRS Free File. The program is available only on IRS.gov through Oct. 15. IRS e-file is easy, safe and the most accurate way to file your taxes. The tax software you use to e-file helps you get all the tax benefits that you’re entitled to claim.
  
  
• Use Direct Deposit.   If you are due a refund, the fastest way to get it is to combine direct deposit and e-file. Direct deposit has a proven track record; eight in 10 taxpayers who get a refund choose it. The IRS issues more than nine out of 10 refunds in less than 21 days.
  
  
• Use IRS Online Payment Options.  If you owe taxes the best way to pay them is with IRS Direct Pay. It’s the simple, quick and free way to pay from your checking or savings account. You also have other online payment options. These include Electronic Funds Withdrawal or payment by debit or credit card. Just click on the “Payments” tab on the IRS.gov home page.
  
  
• Don’t overlook tax benefits.  Make sure to check if you qualify for tax breaks that you might miss if you rush to file. This includes the Earned Income Tax Credit and the Saver’s Credit. The American Opportunity Tax Credit and other education tax benefits can help you pay for college.
  
  
• File on time.  If you owe taxes, file on time to avoid a late filing penalty. If you owe and can’t pay all of your taxes, pay as much as you can to reduce interest and penalties for late payment. Use the Online Payment Agreement tool to ask for more time to pay. You can also file Form 9465, Installment Agreement Request, with your tax return.
  
  
• More time for the military.  Some people have more time to file. This includes members of the military and others serving in a combat zone. If this applies to you, you typically have until at least 180 days after you leave the combat zone to both file returns and pay any taxes due.
  
  
• Try easy-to-use tools on IRS.gov.  Use the EITC Assistant to see if you’re eligible for the credit. Use the Interactive Tax Assistant tool to get answers to common tax questions. The IRS Tax Map gives you a single point to get tax law information by subject. It integrates your topic with related tax forms, instructions and publications into one research tool.

Each and every taxpayer has a set of fundamental rights they should be aware of when dealing with the IRS. These are your Taxpayer Bill of Rights. Explore your rights and our obligations to protect them on IRS.gov.

Source: Internal Revenue Service

Moving this Year? If You Receive the Premium Tax Credit, Report this Life Event

IRS Health Care Tax Tip 2015-54, September 2, 2015

If you moved recently, you’ve probably notified several organizations – like the U.S. Postal Service and utility companies – about your new address. You may have even notified the IRS about your address change.  If you get health insurance coverage through a Health Insurance Marketplace, you should add one more important notification to your list: the Marketplace.

If you are receiving advance payments of the premium tax credit, it is particularly important that you report changes in circumstances, including moving, to the Marketplace. There’s a simple reason. Reporting your move lets the Marketplace update the information used to determine your eligibility for a Marketplace plan, which may affect the appropriate amount of advance payments of the premium tax credit that the government sends to your health insurer on your behalf.

Reporting the changes will help you avoid having too much or not enough premium assistance paid to reduce your monthly health insurance premiums. Getting too much premium assistance means you may owe additional money or get a smaller refund when you file your taxes. On the other hand, getting too little could mean missing out on monthly premium assistance that you deserve.

Changes in circumstances that you should report to the Marketplace include:

• an increase or decrease in your income, including lump sum payments like a lump sum payment of Social Security benefits
• marriage or divorce
• the birth or adoption of a child
• starting a job with health insurance
• gaining or losing your eligibility for other health care coverage

Many of these changes in circumstances – including moving out of the area served by your current Marketplace plan – qualify you for a special enrollment period to change or get insurance through the Marketplace. In most cases, if you qualify for the special enrollment period, you will have sixty days to enroll following the change in circumstances. You can find information about special enrollment periods at HealthCare.gov.

The Premium Tax Credit Change Estimator can help you estimate how your premium tax credit will change if you experience a change in circumstance during the year.
For more information visit IRS.gov/aca.

Source: Internal Revenue Service

Your Health Insurance Company May Ask for Your Social Security Number

IRS Health Care Tax Tip 2015-53, August 27, 2015

Your health insurance company may request that you provide them with the social security numbers for you, your spouse and your children covered by your policy.  This is because the Affordable Care Act requires every provider of minimum essential coverage to report that coverage by filing an information return with the IRS and furnishing a statement to covered individuals. The information is used by the IRS to administer – and individuals to show compliance with – the health care law.
Health coverage providers will file an information return, Form 1095-B, Health Coverage, with the IRS and will furnish statements to you in 2016, to report coverage information from calendar year 2015.

The law requires coverage providers to list social security numbers on this form. If you don't provide your SSN and the SSNs of all covered individuals to the sponsor of the coverage, the IRS may not be able to match the Form 1095-B with the individuals to determine that they have complied with the individual shared responsibility provision.

Your health insurance company may send a letter that discusses these new rules and requests social security numbers for all family members covered under your policy. The IRS has not designated a
specific form for your health insurance company to request this information. The Form 1095-B will provide information for your income tax return that shows you, your spouse, and individuals you claim as dependents had qualifying health coverage for some or all months during the year. You do not have to attach Form 1095-B to your tax return. Keep it with your other important tax documents.
Anyone on your return who does not have minimum essential coverage, and who does not qualify for an exemption, may be liable for the individual shared responsibility payment.

The information received by the IRS will be used to verify information on your individual income tax return. If you refuse to provide this information to your health insurance company, the IRS cannot verify the information you provide on your tax return and you may receive an inquiry from the IRS. You also may receive a notice from the IRS indicating that you are liable for a shared responsibility payment.

For more information, see our Questions and Answers about Reporting Social Security Numbers to Your Health Insurance Company on IRS.gov/aca.

Source: Internal Revenue Service

Top 10 Tax Tips about Filing an Amended Tax Return

IRS Summertime Tax Tip 2015-26, August 31, 2015                                                              

             

We all make mistakes so don’t panic if you made one on your tax return. You can file an amended return if you need to fix an error. You can also amend your tax return if you forgot to claim a tax credit or deduction. Here are ten tips from the IRS if you need to amend your federal tax return.

1. When to amend.  You should amend your tax return if you need to correct your filing status, the number of dependents you claimed, or your total income. You should also amend your return to claim tax deductions or tax credits that you did not claim when you filed your original return. The instructions for Form 1040X, Amended U.S. Individual Income Tax Return, list more reasons to amend a return.
   
   Note: If, as allowed by recent legislation, you plan to amend your tax year 2014 return to retroactively claim the Health Coverage Tax Credit, see IRS.Gov/HCTC first for more information.
   
   
2. When NOT to amend.  In some cases, you don’t need to amend your tax return. The IRS usually corrects math errors when processing your original return. If you didn’t include a required form or schedule, the IRS will send you a notice via U.S. mail about the missing item.
   
   
3. Form 1040X.  Use Form 1040X to amend a federal income tax return that you filed before. Make sure you check the box at the top of the form that shows which year you are amending. Since you can’t e-file an amended return, you’ll need to file your Form 1040X on paper and mail it to the IRS.
   
   Form 1040X has three columns. Column A shows amounts from the original return. Column B shows the net increase or decrease for the amounts you are changing. Column C shows the corrected amounts. You should explain what you are changing and the reasons why on the back of the form.
   
   
4. More than one year.  If you file an amended return for more than one year, use a separate 1040X for each tax year. Mail them in separate envelopes to the IRS. See "Where to File" in the instructions for Form 1040X for the address you should use.
   
   
5. Other forms or schedules.  If your changes have to do with other tax forms or schedules, make sure you attach them to Form 1040X when you file the form. If you don’t, this will cause a delay in processing.
   
   
6. Amending to claim an additional refund.  If you are waiting for a refund from your original tax return, don’t file your amended return until after you receive the refund. You may cash the refund check from your original return. Amended returns take up to 16 weeks to process. You will receive any additional refund you are owed.
   
   
7. Amending to pay additional tax.  If you’re filing an amended tax return because you owe more tax, you should file Form 1040X and pay the tax as soon as possible. This will limit interest and penalty charges.
   
   
8. Corrected Forms 1095-A.  If you or anyone on your return enrolled in qualifying health care coverage through the Health Insurance Marketplace, you should have received a Form 1095-A, Health Insurance Marketplace Statement. You may have also received a corrected Form 1095-A. If you filed your tax return based on the original Form 1095-A, you do not need to file an amended return based on a corrected Form 1095-A.  This is true even if you would owe additional taxes based on the new information. However, you may choose to file an amended return.
   
   In some cases, the information on the new Form 1095-A may lower the amount of taxes you owe or increase your refund.  You may also want to file an amended return if:
   
   • You filed and incorrectly claimed a premium tax credit, or
   • You filed an income tax return and failed to file Form 8962, Premium Tax Credit, to reconcile your advance payments of the premium tax credit.
   
   Before amending your return, if you received a letter regarding your premium tax credit or Form 8962 you should follow the instructions in the letter.
   
   
9. When to file.  To claim a refund file Form 1040X no more than three years from the date you filed your original tax return. You can also file it no more than two years from the date you paid the tax, if that date is later than the three-year rule.
   
   
10. Track your return.  You can track the status of your amended tax return three weeks after you file with “Where’s My Amended Return?” This tool is available on IRS.gov or by phone at 866-464-2050.

You can get Form 1040X on IRS.gov/forms at any time.

Each and every taxpayer has a set of fundamental rights they should be aware of when dealing with the IRS. These are your Taxpayer Bill of Rights. Explore your rights and our obligations to protect them on IRS.gov.

Additional IRS Resources:

• Tax Topic 308 – Amended Returns
• Amended Tax Returns – Frequently Asked Questions

IRS YouTube Videos:
Amending My Return – English | Spanish | ASL
Source: Internal Revenue Service

Boost Your Tax Knowledge with a Free Learning Program from the IRS

IRS Summertime Tax Tip 2015-25, August 28, 2015                              

The IRS has a free program for anyone who wants to learn about taxes. “Understanding Taxes” is available 24/7 on IRS.gov. It was designed by the IRS and teachers to help you learn the “how’s” and “why’s” of taxes. The program can make learning about federal taxes as easy as A-B-C.

• Accessible (web-based)
• Brings learning to life
• Comprehensive

Here are six more reasons to study up on it:

1. Lessons on IRS.gov.  Teachers and students will find that the nearly 40 lessons on IRS.gov are easy, relevant and fun!  
   
   
2. User friendly site map.  You can quickly look through the program and skip to the part you want.
   
   
3. Tutorials, tests and more.  A series of tax tutorials guide you through the basics of tax preparation. Another feature is a chance to test your knowledge through tax trivia. There’s also a glossary of tax terms.
   
   
4. Customize to fit your style.  If you’re a teacher, you can make the interactive program fit your style. Use your own lesson plans and plan your own activities. It’s easy to add to your school’s curriculum.
   
   
5. No need to register.  You don’t need to register or login to use the program. You can take a break and return to where you left off whenever you choose. Just take note of the page and lesson number before you leave the page.
   
   
6. The how’s and why’s of taxes.  Learn the basic concepts of taxes. Self-paced modules offer a step-by-step approach to tax preparation. The lessons are also a great way to learn about the history and theory of taxes in the USA.

You may use the program anytime during the year. Visit IRS.gov and type “Understanding Taxes” in the search box. The application contains lessons and practice problems based on 2014 tax law.

For more current tax law training, visit Link and Learn Taxes on IRS.gov. The IRS will update this program later this year. The Web address is http://apps.irs.gov/app/vita/. You can also find it if you type “Link and Learn” in the search box.

Each and every taxpayer has a set of fundamental rights they should be aware of when dealing with the IRS. These are your Taxpayer Bill of Rights. Explore your rights and our obligations to protect them on IRS.gov.

IRS YouTube Videos:

• Understanding Taxes – English | ASL

Source: Internal Revenue Service

File As Soon As Possible to Maintain Eligibility for Advance Payments of the Premium Tax Credit

IRS Health Care Tax Tip 2015-52, August 25, 2015

The IRS is sending letters to taxpayers who received advance payments of the premium tax credit in 2014, but who have not yet filed their tax return. You must file a tax return to reconcile any advance credit payments you received in 2014 and to maintain your eligibility for future premium assistance. If you do not file, you will not be eligible for advance payments of the premium tax credit in 2016.

If you receive a Letter 5591, 5591A, or 5596, you are being reminded to file your 2014 federal tax return along with Form 8962, Premium Tax Credit.  The letter encourages you to file within 30 days of the date of the letter to substantially increase your chances of avoiding a gap in receiving assistance with paying Marketplace health insurance coverage in 2016.

Here’s what you need to do if you received a 5591 or 5591A letter:

• Read your letter carefully.
• Review the situation to see if you agree with the information in the letter.
• Use the Form 1095-A that you received from your Marketplace to complete your return. If you need a copy of your Form 1095-A, log in to your HealthCare.gov or state Marketplace account or call your Marketplace call center.
• File your 2014 tax return with Form 8962 as soon as possible, even if you don’t normally have to file.
• If you have already filed your 2014 tax return with Form 8962, you can disregard the letter.

Here’s what you need to do if you received a 5596 letter:

• Read your letter carefully.
• Review the situation to see if you agree with the information in the letter.
• Use the Form 1095-A that you received from your Marketplace to complete Form 8962. If you need a copy of your Form 1095-A, log in to your HealthCare.gov or state Marketplace account or call your Marketplace call center.
• File your 2014 tax return with Form 8962 as soon as possible, even though you have an extension until October 15, 2015, to file.
• If you have already filed your 2014 tax return with Form 8962, please disregard this letter.

For more information, see the Affordable Care Act Tax Provisions for Individuals and Families page on IRS.gov/aca.

Source: Internal Revenue Service

Job Search Expenses May be Deductible

IRS Summertime Tax Tip 2015-24, August 26, 2015                               

People often change their job in the summer. If you look for a job in the same line of work, you may be able to deduct some of your job search costs. Here are some key tax facts you should know about if you search for a new job:

• Same Occupation.  Your expenses must be for a job search in your current line of work. You can’t deduct expenses for a job search in a new occupation.
  
  
• Résumé Costs.  You can deduct the cost of preparing and mailing your résumé.
  
  
• Travel Expenses.  If you travel to look for a new job, you may be able to deduct the cost of the trip. To deduct the cost of the travel to and from the area, the trip must be mainly to look for a new job. You may still be able to deduct some costs if looking for a job is not the main purpose of the trip.
  
  
• Placement Agency. You can deduct some job placement agency fees you pay to look for a job.
  
  
• First Job.  You can’t deduct job search expenses if you’re looking for a job for the first time.
  
  
• Substantial Job Break.  You can’t deduct job search expenses if there was a long break between the end of your last job and the time you began looking for a new one.
  
  
• Reimbursed Costs.  Reimbursed expenses are not deductible.
  
  
• Schedule A.  You usually deduct your job search expenses on Schedule A, Itemized Deductions. You’ll claim them as a miscellaneous deduction. You can deduct the total miscellaneous deductions that are more than two percent of your adjusted gross income.
  
  
• Premium Tax Credit.  If you receive advance payments of the premium tax credit it is important that you report changes in circumstances, such as changes in your income or eligibility for other coverage, to your Health Insurance.
  
  
• Marketplace. Other changes that you should report include changes in your family size or address.  Advance payments of the premium tax credit provide financial assistance to help you pay for the insurance you buy through the Health Insurance Marketplace. Reporting changes will help you get the proper type and amount of financial assistance so you can avoid getting too much or too little in advance.
  

For more on job hunting refer to Publication 529, Miscellaneous Deductions. You can get IRS tax forms and publications on IRS.gov/forms at any time.
Each and every taxpayer has a set of fundamental rights they should be aware of when dealing with the IRS. These are your Taxpayer Bill of Rights. Explore your rights and our obligations to protect them on IRS.gov
Additional IRS Resources:

• Publication 463, Travel, Entertainment, Gift, and Car Expenses
• The “What Ifs” for Struggling Taxpayers
• Publication 4128, Tax Impact of Job Loss
• Publication 5152: Report changes to the Marketplace as they happen  English | Spanish

IRS YouTube Videos:

• Job Search Expenses – English | Spanish | ASL
• What If – English | Spanish | ASL
• Premium Tax Credit – English | Spanish | ASL
• Premium Tax Credit: Changes in Circumstances – English| Spanish

IRS Podcasts:

• Premium Tax Credit – English | Spanish
• Premium Tax Credit Changes in Circumstances – English | Spanish

Source: Internal Revenue Service

Key Tax Tips on the Tax Effects of Divorce or Separation

IRS Summertime Tax Tip 2015-23, August 24, 2015

Income tax may be the last thing on your mind after a divorce or separation. However, these events can have a big impact on your taxes. Alimony and a name change are just a few items you may need to consider. Here are some key tax tips to keep in mind if you get divorced or separated.

• Child Support.  If you pay child support, you can’t deduct it on your tax return. If you receive child support, the amount you receive is not taxable.
  
  
• Alimony Paid.  If you make payments under a divorce or separate maintenance decree or written separation agreement you may be able to deduct them as alimony. This applies only if the payments qualify as alimony for federal tax purposes. If the decree or agreement does not require the payments, they do not qualify as alimony.
  
  
• Alimony Received.  If you get alimony from your spouse or former spouse, it is taxable in the year you get it. Alimony is not subject to tax withholding so you may need to increase the tax you pay during the year to avoid a penalty. To do this, you can make estimated tax payments or increase the amount of tax withheld from your wages.
  
  
• Spousal IRA.  If you get a final decree of divorce or separate maintenance by the end of your tax year, you can’t deduct contributions you make to your former spouse's traditional IRA. You may be able to deduct contributions you make to your own traditional IRA.
  
  
• Name Changes.  If you change your name after your divorce, notify the Social Security Administration of the change. File Form SS-5, Application for a Social Security Card. You can get the form on SSA.gov or call 800-772-1213 to order it. The name on your tax return must match SSA records. A name mismatch can delay your refund.  

Health Care Law Considerations

• Special Marketplace Enrollment Period.  If you lose your health insurance coverage due to divorce, you are still required to have coverage for every month of the year for yourself and the dependents you can claim on your tax return. Losing coverage through a divorce is considered a qualifying life event that allows you to enroll in health coverage through the Health Insurance Marketplace during a Special Enrollment Period.
  
  
• Changes in Circumstances.  If you purchase health insurance coverage through the Health Insurance Marketplace you may get advance payments of the premium tax credit in 2015. If you do, you should report changes in circumstances to your Marketplace throughout the year. Changes to report include a change in marital status, a name change and a change in your income or family size. By reporting changes, you will help make sure that you get the proper type and amount of financial assistance. This will also help you avoid getting too much or too little credit in advance.
  
  
• Shared Policy Allocation. If you divorced or are legally separated during the tax year and are enrolled in the same qualified health plan, you and your former spouse must allocate policy amounts on your separate tax returns to figure your premium tax credit and reconcile any advance payments made on your behalf. Publication 974, Premium Tax Credit, has more information about the Shared Policy Allocation.

For more on this topic, see Publication 504, Divorced or Separated Individuals. You can get it on IRS.gov/forms at any time.

Each and every taxpayer has a set of fundamental rights they should be aware of when dealing with the IRS. These are your Taxpayer Bill of Rights. Explore your rights and our obligations to protect them on IRS.gov.
Additional IRS Resources:

• Publication 590-A, Contributions to Individual Retirement Arrangements (IRAs)
• Publication 555, Community Property
• Publication 974, Premium Tax Credit
• Publication 5152: Report changes to the Marketplace as they happen  English | Spanish

IRS YouTube Videos:

• Changed Your Name After Marriage or Divorce? – English | Spanish | ASL
• Premium Tax Credit – English | Spanish | ASL
• Premium Tax Credit: Changes in Circumstances – English | Spanish | ASL

IRS Podcasts:

• Premium Tax Credit – English | Spanish
• Changed Your Name After Marriage or Divorce? – English | Spanish

Source: Internal Revenue Service

Become a Tax Volunteer and Make a Difference in Your Community

IRS Summertime Tax Tip 2015-22, August 21, 2015           

If you ever wonder how to make a difference and help people in your community, then becoming a tax volunteer may be just right for you. The IRS is looking for people who will provide free tax help in 2016. You will receive all the tax training you need so you can help others file their tax return.

The IRS sponsors two programs that offer free tax help across the country. These are the Volunteer Income Tax Assistance and Tax Counseling for the Elderly programs. Many people know them by their initials. In 2015, VITA and TCE volunteers prepared more than 3.7 million tax returns at no cost for people with low-to-moderate incomes.
Here are five good reasons why you should become a VITA or TCE volunteer.

1. No prior experience needed.  You’ll receive specialized training and can serve in a variety of roles. If you are fluent in another language, you may be able to help those who speak that language.
   
   
2. Free tax law training and materials.  You’ll learn how to prepare basic tax returns and learn about tax deductions and credits that benefit eligible taxpayers. These include credits such as the Earned Income Tax Credit, Child Tax Credit and Credit for the Elderly.
   
   
3. Volunteer hours are flexible.  Volunteers generally serve an average of three to five hours per week. The programs are usually open from mid-January through the tax filing deadline in April. A few sites are open all year.
   
   
4. VITA and TCE sites are often nearby.  More than 12,000 sites were set up in neighborhoods all over the country this year. They are often set up in community centers, libraries, schools, shopping malls and similar places. Chances are good that you can volunteer at a site near you.
   
   
5. Continuing education credits for tax pros.  Enrolled Agents and non-credentialed tax return preparers can earn credits when volunteering as a VITA/TCE instructor, quality reviewer or tax return preparer. See the IRS fact sheet for more information on Continuing Education Credits.  

As a volunteer, you’ll join a program that’s helped millions of people file tax returns at no charge for more than 40 years. Your help will make a difference. It’s people helping people. It's that simple.
To find out more, visit IRS.gov and type "tax volunteer" in the search box. If you’d like to become a volunteer, you will need to submit your volunteer interest information on IRS.gov at IRS Tax Volunteers.

Additional IRS Resources:

• IRS Tax Volunteers
• IRS Free Tax Return Preparation Programs
• Link & Learn Taxes

IRS YouTube Videos:

• Volunteer Income Tax Assistance Recruitment – English | Spanish | ASL

Source: Internal Revenue Service

Get Tax Help with Social Media

IRS Summertime Tax Tip 2015-21, August 19, 2015

Whether you use social media to blog, share photos or socialize, you can also use it to connect with the IRS.  You can check on your tax refund, learn the latest tax news, or get helpful Tax Tips on how to do your taxes. Here are some of the ways you can use IRS social media to get tax help:

• Twitter.  IRS tweets include tax-related tips, news for tax professionals and more. Follow the IRS @IRSnews, @IRStaxpros and @IRSenEspanol. Follow the Taxpayer Advocate Service @YourVoiceAtIRS.
  
  
• IRS2Go.  IRS2Go is a free app where you can check your refund status, get tax news or follow the IRS on Twitter. Subscribe to get helpful IRS Tax tips via email. You can download the app free from the Google Play Store for Android devices, or from the Apple App Store for Apple devices. IRS2Go is available in both English and Spanish.
  
  
• YouTube.  IRS YouTube Channels offer short videos on a variety of tax topics. You can view them in English, Spanish and American Sign Language.
  
  
• Tumblr.  The IRS Tumblr blog gives you the latest tax news. You can access Tumblr from your smartphone, tablet or computer.
  
  
• Facebook.  IRS Facebook pages post useful information for taxpayers and tax return preparers. You can also connect with the Taxpayer Advocate Service.
  
  
• Podcasts.  Short IRS podcasts provide useful tips on many tax topics. Listen to these audio files from the Multimedia Center page on IRS.gov.

Protecting your privacy is a top priority at the IRS. The IRS uses social media tools to share public information. We do not use social media to answer personal tax or account questions. You should never post your Social Security number or any other confidential information on social media sites.

Source: Internal Revenue Service

Moving Expense Deduction

IRS Summertime Tax Tip 2015-20, August 17, 2015

If you move your home you may be able to deduct the cost of the move on your federal tax return next year. This may apply if you move to start a new job or to work at the same job in a new location. In order to deduct your moving expenses, your move must meet three requirements:

1. Your move must closely relate to the start of work.  In most cases, you can consider moving expenses within one year of the date you start work at a new job location. Additional rules apply to this requirement.
   
   
2. Your move must meet the distance test.  Your new main job location must be at least 50 miles farther from your old home than your prior job location. For example, let’s say that your old job was three miles from your old home. To meet this test, your new job must be at least 53 miles from your old home.
   
   
3. You must meet the time test.  You must work full-time at your new job for at least 39 weeks the first year after the move. If you’re self-employed, you must also meet this test. In addition you must work full-time for a total of at least 78 weeks during the first two years at the new job site. If your tax return is due before you meet the time test, you can still claim the deduction if you expect to meet it.

See Publication 521, Moving Expenses, for more information about the rules.
If you qualify for this deduction, here are a few more tips from the IRS:

• Travel.  You can deduct certain transportation and lodging expenses while moving. This applies to costs for yourself and other household members while moving from your old home to your new home. You may not deduct your travel meal costs.
  
  
• Household goods and utilities.  You can deduct the cost of packing, crating and shipping your property. This may include the cost to store or insure the items while in transit. You can deduct the cost to disconnect or connect utilities at your old and new homes.
  
  
• Expenses you can’t deduct.  You may not deduct:
    o Any part of the purchase price of your new home.
    o The cost of selling your home.
    o The cost of breaking or entering into a lease.
  
  See Publication 521 for more examples.
  
  
• Reimbursed expenses.  If your employer later pays you for the cost of a move that you deducted on your tax return, you may need to include the payment as income. You must report any taxable amount on your tax return in the year you get the payment.
  
  
• Address change.  When you move, make sure to update your address with the IRS and the U.S. Post Office. To notify the IRS, file Form 8822, Change of Address.

Premium Tax Credit – Changes in Circumstances.  If you purchased health insurance coverage from the Health Insurance Marketplace, you may receive advance payments of the premium tax credit. It is important that you report changes in circumstances, such as when you move to a new address, to your Marketplace. Other changes that you should report include changes in your income, employment, family size, or eligibility for other coverage. Advance credit payments provide premium assistance to help you pay for the insurance you buy through the Marketplace. Reporting changes will help you get the proper type and amount of premium assistance so you can avoid getting too much or too little in advance.
You can get Publication 521 and Form 8822 on IRS.gov/forms at any time.
Additional IRS Resources:

• Publication 5152: Report changes to the Marketplace as they happen – English | Spanish
• Can I Deduct My Moving Expenses? – Interactive Tax Assistant tool
• Tax Topic 455 – Moving Expenses
• Form 3903, Moving Expenses

IRS YouTube Videos:

• Moving Expenses – English | Spanish | ASL
• Premium Tax Credit: Changes in Circumstances – English | Spanish | ASL

IRS Podcasts:

• Moving Expenses – English | Spanish
• Premium Tax Credit Changes in Circumstances – English | Spanish

Source: Internal Revenue Service

IRS Tips to Help People Pay Their Taxes

IRS Summertime Tax Tip 2015-21, August 19, 2015

Whether you use social media to blog, share photos or socialize, you can also use it to connect with the IRS.  You can check on your tax refund, learn the latest tax news, or get helpful Tax Tips on how to do your taxes. Here are some of the ways you can use IRS social media to get tax help:

• Twitter.  IRS tweets include tax-related tips, news for tax professionals and more. Follow the IRS @IRSnews, @IRStaxpros and @IRSenEspanol. Follow the Taxpayer Advocate Service @YourVoiceAtIRS.
  
  
• IRS2Go.  IRS2Go is a free app where you can check your refund status, get tax news or follow the IRS on Twitter. Subscribe to get helpful IRS Tax tips via email. You can download the app free from the Google Play Store for Android devices, or from the Apple App Store for Apple devices. IRS2Go is available in both English and Spanish.
  
  
• YouTube.  IRS YouTube Channels offer short videos on a variety of tax topics. You can view them in English, Spanish and American Sign Language.
  
  
• Tumblr.  The IRS Tumblr blog gives you the latest tax news. You can access Tumblr from your smartphone, tablet or computer.
  
  
• Facebook.  IRS Facebook pages post useful information for taxpayers and tax return preparers. You can also connect with the Taxpayer Advocate Service.
  
  
• Podcasts.  Short IRS podcasts provide useful tips on many tax topics. Listen to these audio files from the Multimedia Center page on IRS.gov.

Protecting your privacy is a top priority at the IRS. The IRS uses social media tools to share public information. We do not use social media to answer personal tax or account questions. You should never post your Social Security number or any other confidential information on social media sites.

Source: Internal Revenue Service

Don’t Fall for New Tax Scam Tricks by IRS Posers

IRS Summertime Tax Tip 2015-18, August 12, 2015

Though the tax season is over, tax scammers work year-round. The IRS advises you to stay alert to protect yourself against new ways criminals pose as the IRS to trick you out of your money or personal information. These scams first tried to sting older Americans, newly arrived immigrants and those who speak English as a second language. The crooks have expanded their net, and now try to swindle virtually anyone. Here are several tips from the IRS to help you avoid being a victim of these scams:

• Scams use scare tactics.  These aggressive and sophisticated scams try to scare people into making a false tax payment that ends up with the criminal. Many phone scams use threats to try to intimidate you so you will pay them your money. They often threaten arrest or deportation, or that they will revoke your license if you don’t pay. They may also leave “urgent” callback requests, sometimes through “robo-calls,” via phone or email. The emails will often contain a fake IRS document with a phone number or an email address for you to reply.
  
  
• Scams use caller ID spoofing.  Scammers often alter caller ID to make it look like the IRS or another agency is calling. The callers use IRS titles and fake badge numbers to appear legit. They may use online resources to get your name, address and other details about your life to make the call sound official.
  
  
• Scams use phishing email and regular mail.  Scammers copy official IRS letterhead to use in email or regular mail they send to victims. In another new variation, schemers provide an actual IRS address where they tell the victim to mail a receipt for the payment they make. All in an attempt to make the scheme look official.
  
  
• Scams cost victims over $20 million.  The Treasury Inspector General for Tax Administration, or TIGTA, has received reports of about 600,000 contacts since October 2013. TIGTA is also aware of nearly 4,000 victims who have collectively reported over $20 million in financial losses as a result of tax scams.

The real IRS will not:

• Call you to demand immediate payment. The IRS will not call you if you owe taxes without first sending you a bill in the mail.
• Demand that you pay taxes and not allow you to question or appeal the amount that you owe.
• Require that you pay your taxes a certain way. For instance, require that you pay with a prepaid debit card.
• Ask for credit or debit card numbers over the phone.
• Threaten to bring in police or other agencies to arrest you for not paying.
  

If you don’t owe taxes or have no reason to think that you do:

• Do not provide any information to the caller. Hang up immediately.
• Contact the Treasury Inspector General for Tax Administration. Use TIGTA’s “IRS Impersonation Scam Reporting” web page to report the incident.
• You should also report it to the Federal Trade Commission. Use the “FTC Complaint Assistant” on FTC.gov. Please add "IRS Telephone Scam" in the notes.
  

If you know you owe, or think you may owe taxes:

• Call the IRS at 800-829-1040. IRS workers can help you if you do owe taxes.

Stay alert to scams that use the IRS as a lure. For more, visit “Tax Scams and Consumer Alerts” on IRS.gov.
IRS YouTube Videos:

• Tax Scams – English | Spanish | ASL  

IRS Podcasts:

• Tax Scams – English | Spanish

Source: Internal Revenue Service

IRS Offers Easy-to-Use Online Tools

IRS Summertime Tax Tip 2015-17, August 10, 2015                                              

When you need tax help, the IRS has many online tools that are easy to use. You can e-file your tax return free, check your refund’s status or get your tax questions answered.  Use our tools on IRS.gov any time of day or night. Here’s a list of popular self-help tools that millions have used to get free tax help:

• IRS Free File.  You can use IRS Free File to prepare and e-file your federal tax return for free. Free File will do much of the work for you with brand-name tax software or Fillable Forms. If you still need to file your 2014 tax return, Free File is available through Oct. 15. The only way to use IRS Free File is through the IRS website.
  
  
• Where’s My Refund?  Checking the status of your tax refund is easy when you use Where's My Refund? You can also use this tool with the IRS2Go mobile app.
  
  
• Direct Pay.  Use IRS Direct Pay to pay your tax bill or pay your estimated tax directly from your checking or savings account. Direct Pay is safe, easy and free. The tool walks you through five simple steps to pay your tax in one online session. You can also use Direct Pay with the IRS2Go mobile app.
  
  
• Online Payment Agreement.  If you can’t pay your taxes in full, apply for an Online Payment Agreement. The Direct Debit payment plan option is a lower-cost hassle-free way to pay your tax each month.
  
  
• Withholding Calculator.  Did you get a larger refund or owe more tax than you expected the last time you filed your tax return? If so, you may want to change the amount of tax withheld from your paycheck. The Withholding Calculator tool can help you determine if you need to give your employer a new Form W-4, Employee's Withholding Allowance Certificate. The tool can also help you fill out the form. Give the new form to your employer to make the change.
  
  
• Interactive Tax Assistant.  If you need to know about 2014 taxes, you should try the Interactive Tax Assistant tool to get what you need. If you do not have qualifying health insurance coverage, the tool can help. For instance, you can find out if you must make an individual shared responsibility payment or if you are eligible for an exemption, when you file your income tax return. You can also use the tool to find out if you are eligible for the premium tax credit.
  
  
• IRS Select Check.  If you want to deduct your gift to charity, the organization you give to must be qualified. Use the IRS Select Check tool to see if a group is qualified.
  
  
• Tax Map.  The IRS Tax Map gives you a single point to get tax law information by subject. It integrates your topic with related tax forms, instructions and publications into one research tool.

IRS YouTube Videos:

• Welcome to Free File – English
• When Will I Get My Refund? – English | Spanish | ASL
• IRS2Go 5.0 – English | Spanish | ASL (Obsoleted)
• IRS Tax Payment Options – English | Spanish | ASL
• Online Payment Agreement – English | Spanish | ASL
• IRS Withholding Calculator – English | Spanish | ASL
• Help for Taxpayers – English | Spanish | ASL
• Interactive Tax Assistant – English | ASL

IRS Podcasts:

• When Will I Get My Refund – English | Spanish
• IRS2Go 5.0 – English | Spanish (Obsoleted)
• IRS Tax Payment Options – English | Spanish
• Online Payment Agreement – English | Spanish
• IRS Withholding Calculator – English | Spanish
• Help for Taxpayers – English
• Interactive Tax assistant -- English

Source: Internal Revenue Service

Getting Married Can Affect Your Premium Tax Credit

IRS Health Care Tax Tip 2015-47, August 6, 2015

If you’re a newlywed, be sure to add a health insurance review to your to-do list. This is particularly important if you enrolled in coverage through a Health Insurance Marketplace and receive premium assistance in the form of advance payments of the premium tax credit.

Advance credit payments made to your insurance company are based on an estimate of the credit that you will claim on your federal income tax return. The Marketplace estimates the credit by using information about your family composition and projected income that you provide when you submit your application.

It is important for you to report changes in circumstances to your Marketplace to get the proper type and amount of financial assistance and to avoid getting too much or too little in advance. Reporting changes in circumstances will allow the Marketplace to adjust your advance credit payments. This adjustment will help you avoid getting a smaller refund or owing money that you did not expect to owe on your federal tax return.

To report changes and to adjust the amount of your advance payments of the premium tax credit you must contact your Health Insurance Marketplace. Be sure to report all changes directly to that Marketplace because they can affect both your coverage and your final credit when you file your federal tax return.
Other changes you should report to the Marketplace include:

• Birth or adoption
• Marriage or divorce
• Moving to another address
• Changes in household income

These changes may also open the door for the Marketplace special enrollment period that permits health care plan changes. In most cases, the special enrollment period for Marketplace coverage is open for 60 days from the date of the life event.

Estimating Your Change

The Premium Tax Credit Change Estimator can help you estimate how your premium tax credit will change if your income or family size changes during the year. This estimator tool does not report changes in circumstances to your Marketplace. Because these tools provide only an estimate, you should not rely upon them as an accurate calculation of the information you will report on your tax return. You should use these estimators only as a guide to assist you in making decisions regarding your tax situation.

For more information, see the Affordable Care Act Tax Provisions for Individuals and Families page at IRS.gov/aca.

Source: Internal Revenue Service

Eight Things to Know about the Taxpayer Advocate Service

IRS Summertime Tax Tip 2015-16, August 7, 2015 

1. TAS is Your Voice at IRS.  The Taxpayer Advocate Service, or TAS, is your voice at the IRS. We are an independent organization within the IRS.
   
   
2. TAS Helps Resolve Problems.  TAS helps individuals, businesses and exempt organizations who are not able to resolve their tax problems with the IRS. Our service is always free. TAS can help if:
   
   • Your problem is causing financial difficulty for you, your family, or your business.
   • You, your business or your organization is facing an immediate threat of adverse action.
   • You have tried repeatedly to contact the IRS but no one has responded. We will also help if the IRS has not responded by the date promised.

3. Taxpayer Bill of Rights.  The IRS has adopted a Taxpayer Bill of Rights that includes 10 basic rights that every taxpayer has when interacting with the IRS:
   
   • The right to be informed.
   • The right to quality service.
   • The right to pay no more than the correct amount of tax.
   • The right to challenge the IRS's position and be heard.
   • The right to appeal an IRS decision in an independent forum.
   • The right to finality.
   • The right to privacy.
   • The right to confidentiality.
   • The right to retain representation.
   • The right to a fair and just tax system.
4. TAS Protects Your Rights.  TAS protects taxpayers' rights by ensuring that the IRS treats all taxpayers fairly and that you know and understand your rights. Our taxpayer rights web page can help you understand what these rights mean to you and how they apply.
   
   
5. TAS on the Web Toolkit Can Help.  The TAS Tax Toolkit at TaxpayerAdvocate.irs.gov explains common tax issues. It also offers self-help videos and documents. You can use the site's information to solve your tax problem or help you understand it when you work with the IRS and your tax preparer.
   
   
6. Report a Problem that Affects Many Taxpayers.  TAS also handles large-scale or “big picture” problems that affect many taxpayers. You can report these issues at www.irs.gov/sams.
   
   
7. TAS in Every State.  We have offices in every state, the District of Columbia and Puerto Rico. Your local advocate’s number is in your local directory and at taxpayeradvocate.irs.gov. You can also call us at 877-777-4778 FREE.
   
   
8. TAS on Social Media.  Keep up with us via social media:
   
   • facebook.com/YourVoiceAtIRS
   • twitter.com/YourVoiceatIRS
   • youtube.com/TASNTA

IRS YouTube Videos:

• Taxpayer Bill of Rights – English | Spanish | ASL

IRS Podcasts:

• Taxpayer Bill of Rights – English | Spanish

Source: Internal Revenue Service

IRS Tax Tips for Starting a Business

IRS Summertime Tax Tip 2015-15, August 5, 2015                                          

When you start a business, a key to your success is to know your tax obligations. You may not only need to know about income tax rules, but also about payroll tax rules. Here are five IRS tax tips that can help you get your business off to a good start.

1. Business Structure.  An early choice you need to make is to decide on the type of structure for your business. The most common types are sole proprietor, partnership and corporation. The type of business you choose will determine which tax forms you will file.
   
   
2. Business Taxes.  There are four general types of business taxes. They are income tax, self-employment tax, employment tax and excise tax. In most cases, the types of tax your business pays depends on the type of business structure you set up. You may need to make estimated tax payments. If you do, use IRS Direct Pay to pay them. It’s the fast, easy and secure way to pay from your checking or savings account.
   
   
3. Employer Identification Number.  You may need to get an EIN for federal tax purposes. Search “do you need an EIN” on IRS.gov to find out if you need this number. If you do need one, you can apply for it online.
   
   
4. Accounting Method.  An accounting method is a set of rules that you use to determine when to report income and expenses. You must use a consistent method. The two that are most common are the cash and accrual methods. Under the cash method, you normally report income and deduct expenses in the year that you receive or pay them. Under the accrual method, you generally report income and deduct expenses in the year that you earn or incur them. This is true even if you get the income or pay the expense in a later year.
   
   
5. Employee Health Care.  The Small Business Health Care Tax Credit helps small businesses and tax-exempt organizations pay for health care coverage they offer their employees. A small employer is eligible for the credit if it has fewer than 25 employees who work full-time, or a combination of full-time and part-time. The maximum credit is 50 percent of premiums paid for small business employers and 35 percent of premiums paid for small tax-exempt employers, such as charities.
   
   The employer shared responsibility provisions of the Affordable Care Act affect employers employing at least a certain number of employees (generally 50 full-time employees or a combination of full-time and part-time employees). These employers’ are called applicable large employers. ALEs must either offer minimum essential coverage that is “affordable” and that provides “minimum value” to their full-time employees (and their dependents), or potentially make an employer shared  responsibility payment to the IRS. The vast majority of employers will fall below the ALE threshold number of employees and, therefore, will not be subject to the employer shared responsibility provisions.
   
   Employers also have information reporting responsibilities regarding minimum essential coverage they offer or provide to their fulltime employees.  Employers must send reports to employees and to the IRS on new forms the IRS created for this purpose.

Get all the tax basics of starting a business on IRS.gov at the Small Business and Self-Employed Tax Center.

Additional IRS Resources:

• IRS Tax Calendar for Businesses and Self-Employed
• Publication 505, Tax Withholding and Estimated Tax
• Publication 334, Tax Guide for Small Business
• Publication 225, Farmers Tax guide
• Publication 535, Business Expenses
• Publication 587, Business Use of Your Home
• Publication 510, Excise Taxes
• Publication 538, Accounting Periods and Methods

IRS YouTube Videos:

• Small Business Health Care Tax Credit – English | Spanish | ASL
• IRS Online Tax Calendar – English | Spanish | ASL
• Simplified Home Office Deduction – English | Spanish | ASL

IRS Podcasts:

• Small Business Health Care Tax Credit – English | Spanish
• IRS Online Tax Calendar – English | Spanish
• Simplified Home Office Deduction – English | Spanish

Source: Internal Revenue Service