That whole fiscal cliff thing that tested our patience into the new year? It also, predictably, gummed up the works inside the Internal Revenue Service.
Again.
The almighty agency has scores of tax calculations to adjust, temporary breaks to extend for another year, and new loopholes to catch. It's a lot to ask of a bureau charged with processing 143 million individual tax returns. But Congress has been asking every year of late.
More tax help
Read Brent's
.
For other free resources, forms and instructions on doing your taxes, check out
Unfortunately, for many taxpayers, that could mean delayed refunds.
I won't repeat all the changes brought on by the fiscal cliff deal and health reform that I covered in previous columns. Instead, let's cover a few other trends and wrinkles specific to the 2012 tax season.
We'll also review a confusing but rewarding opportunity for seniors to save taxes by donating from their IRA to charity. But hurry. The opportunity expires Thursday.
Delayed refunds for many.
The IRS and Oregon Department of Revenue begin processing most returns on Wednesday, eight days later than planned. They'll take returns with the dreaded Alternative Minimum Tax and those claiming recently extended breaks for tuition and fees, out-of-pocket classroom expenses and sales taxes (Washington residents, that means you).
But if you're a business owner or landlord who depreciates property or equipment -- not so fast. Yours are among returns the IRS won't accept until late February or early March.
That's because the forms you use are among 30 supplemental forms that the agency won't start processing Jan. 30. Congress fiddled with those areas of the tax code on Jan. 2. The IRS says it needs time to reprogram and test its computers to handle that fiddling.
Some of these forms cover rather esoteric tax breaks. If you're on a mine rescue team, for instance, your Form 8923 for training credit is among those delayed.
But other forms on the list cover more common breaks for landlords, passive business owners and green-energy buffs.
Forms for qualified adoption expenses, credits for energy-efficient homes and appliances and credits for plug-in electric vehicles will be held up. Find a list of affected forms at
.
Tax pros are preparing returns but sticking them on their shelf until the IRS will take them.
Intuit Inc.'s TurboTax will let you fill out your return as far as you can and then save it to complete later. You can sign up for an email alert when the IRS begins taking your forms so you can complete and file, spokeswoman Julie Miller said.
Update your software.
Speaking of tax software, if you bought yours off the shelf before January, make sure you download the latest update. Otherwise, you might miss changes accommodating the fiscal-cliff deal.
Senior IRA charitable donations.
Are you older than 70 1/2 and required to take money from your Individual Retirement Accounts? You have a few more days to make required distributions directly to charities, effectively reducing your adjusted gross income.
For several years, Congress allowed such seniors to contribute up to $100,000 directly from their IRA to charities, but the break was set to disappear for 2012.
That left Sylvia Burk of Netarts taking a required IRA distribution in December and making donations to her church and the Salvation Army separately out of her checking account.
Surprise! Congress revived the perk Jan. 2 as part of the fiscal cliff deal and made it good for 2012 and 2013. Since few saw this coming, it's also allowing seniors to make IRA distributions to charities this month and count them as if they happened in 2012.
Burk wondered if she could now treat her December cash donations as if they had come directly out of her IRA.
Turns out, she can, the IRS confirmed to me in an email -- as long as she made the IRA withdrawals in December.
"This is a good time to be at least age 70 1/2 and be blessed with an IRA," said Burk, 76. She plans to make extra donations this week to her church and alma mater, Lewis & Clark College.
Keep good records if self-employed.
Anecdotally, CPAs say they saw more audits last year zeroing in on self-employed taxpayers -- the folks who file Schedule Cs.
That means you need to keep copious track of business expenses you claim -- especially meals, cellphone use and auto expenses. If you're ever audited, the IRS could ask for them.
"Some people think just a canceled check is evidence, but it's not," said David Chvatal, an accountant in Portland. "You have to have physical receipts."
For business meals, Chvatal suggests writing on the receipt who attended. For auto expenses, the IRS expects an ongoing log, not one re-created for the audit itself, he said.
And if you do claim a lot of unreimbursed business expenses, make sure they're really ones your employer won't cover. The IRS has been asking for employee manuals to verify whether the expense is covered, said Greg Rogers, an accountant in Oregon City. If no manual exists or you can't show you asked about reimbursement, you might have to forgo the deduction.
No tax-prep crisis here.
On Jan. 18, with tax season bearing down, a federal judge blocked a new IRS program set up to root out unscrupulous tax preparers. The agency rescinded the registration and testing system it set up for 700,000 tax preparers and asked the judge to reconsider.
None of that matters much here in Oregon. We're the only state that
who aren't CPAs or attorneys.
Now, if you could just look up your tax adviser's regulatory history online (you can read
), Oregonians would be sitting pretty.
--
welcomes questions about his column or blog. Reach him at 503-221-8359. Stay tuned to his blog for more tax tips throughout the 2012 season. Follow It's Only Money on
,
or
.
