This New Year promises to be full of tax activity with the new administration promising to repeal some major laws and revise others. So, let’s begin.
Tax Refunds – Starting with 2016 returns filed in 2017, IRS is mandated by law to wait until February 15, 2017 before doling out refunds to taxpayers who claimed the Earned Income Tax Credit or the refundable Child Tax Credit. Measures to help detect tax identity theft and refund fraud could also result in delays to refunds being issued.
Speaking of Refunds – Remember, you can go to www.irs.gov to track your federal refund. You will need to know the taxpayer’s social security number, the filing status shown on the return and the exact refund amount. Then click on the “Where’s My Refund?” button and your question should be answered.
Energy Credit – Many energy credits expired as of 12/31/2016, such as the thermal doors and windows installation. For home owners, the 30% credit for installing solar energy panels will be in effect through 12/31/2019. The credit reduces to 26% from 1/1/2020 to 12/31/2020 and finally to 22% from 1/1/2021 to 12/31/2021. Afterward, the credit is set to expire unless Congress votes to reinstate it.
Standard Mileage Rates – These will drop slightly in 2017. The business mileage deduction will be 53.5 cents per mile, medical and moving will be 17 cents per mile and charitable mileage remains at 14 cents per mile, per statute.
Gifts – You will be able to gift up to $14,000 to a donee in 2017 without any reporting requirement. The gift must be made on or before 12/31/2017 in order to be considered a 2017 gift. If you miss that date then you will not have made a 2017 excludable gift.
Identity Theft – This is just a reminder that neither the IRS nor the FTB will call you and ask for personal information or tell you that you owe them money. If you get such a call, hang up immediately and do not answer any questions!
FinCEN filing – For those of you who need to file a Foreign Bank Report (FBAR) with the Financial Crimes Enforcement Network (FinCEN form 114), the filing deadline is no longer June 30th. This report is due on April 15th and, for the first time, filing can be extended until October 15th. This is good news for all concerned.