Back Taxes

IRS is hitting pause on sending out many balance-due notices, in response to criticism from lawmakers. IRS will stop mailing out second notices o taxpayers with outstanding tax debt. It is taking this step to avoid confusion for taxpayers who responded to IRS’s first balance-due notice by mailing a payment. Much of that correspondence is still sitting unopened in the agency’s mail backlog. Also, IRS is postponing many new tax lien notices through Sept. 30.

Forms

The 2020 Form 1040 will look slightly different from the 2019 version, based on a draft released by IRS. The return will have two new line items: One for the above-the-line deduction for cash charitable contributions of $300 or less by non-itemizers. The other allows eligible filers who qualify for stimulus payments to reconcile the amount they received against the recovery rebate credit they otherwise entitled to. These two changes apply only for 2020. Additionally, whether filers have transacted in virtual currency has been moved from Schedule 1 on last year’s 1040 to page 1 of the 2020 return. If you have any questions or need clarification, please feel free to reach out to us at info@bjkane.com.